Canada is calling for decisive action from its allies to counter what it views as aggressive market manipulation by China in the critical minerals sector. With China holding a dominant position in the mining, processing, and value addition of essential metals crucial to the energy transition, Canada’s Natural Resources Minister Jonathan Wilkinson has pushed for pricing floors as a solution to China’s disruptive influence on the market, Mining Zimbabwe can report.
By Rudairo Mapuranga
Speaking at an event hosted by the Wilson Center in Washington on Wednesday, Wilkinson accused China of manipulating global critical mineral markets, which undermines fair competition as well as environmental and labour standards.
“We in Canada and in the United States are not going to go into a downward spiral on labour standards in order to compete with China. But we need to acknowledge that we do have labour standards that add costs — and that has to be built into this conversation around pricing,” he said.
China’s near-monopoly on the production and processing of critical minerals, which are vital for electric vehicles, batteries, solar panels, and military technology, has forced the U.S. and its allies to reconsider their strategies.
With China flooding the market with undervalued resources, it is making it almost impossible for other nations to compete, especially those with higher environmental and labor standards. By driving down prices, China has been accused of distorting global markets and preventing the development of alternative supply chains.
Wilkinson has proposed making pricing floors a “centrepiece” of discussions when Canada hosts the G-7 Summit in June, encouraging collaboration among G-7 nations and extending the initiative to other countries, such as Australia. He highlighted how China’s “nickel dumping” has severely impacted Australia’s mining industry, further emphasizing the need for urgent collective action.
China’s strategy of controlling every stage of the critical minerals supply chain — from mining to processing and even value addition — gives it an outsized influence on global prices. This manipulation not only harms the competitive landscape but also threatens the security and sustainability of industries that rely on these minerals.
To counter China’s economic stranglehold, Wilkinson argued, allies must provide investors with the assurance that their investments in mining and resource development will not be undermined by China’s interference.
“If China can simply intervene and crater the price, you will never see the development of the critical minerals that we have to,” he said, making it clear that without safeguards, China will continue to undercut global markets.
While the U.S. has explored federal funding to support domestic critical mineral projects, including price floors to protect against China’s price manipulation, Canada is pushing for broader international cooperation to level the playing field. Wilkinson has had talks with the Biden administration and key U.S. lawmakers, with plans to engage with other political stakeholders to shore up support for these measures.
China’s predatory pricing and market manipulation tactics, if left unchecked, could severely jeopardize the development of crucial mineral resources needed for the future of green technology and global security. Canada’s call for a unified approach is a bold step toward curbing China’s unchecked dominance in the critical minerals market, ensuring a fairer and more sustainable future for the sector.
