Canadian silver producers seek recognition of critical mineral status as deficits continue
A group of 19 Canadian silver miners is asking the federal government in Ottawa to recognise silver as a critical mineral as the country’s producers boost production to C$300 million per year.
Acknowledging that the second half of the 20th century saw silver production in Canada decline due to economic factors and falling grades, the companies say that in recent years there has been a resurgence in interest and exploration.
Canada is the 13th-largest silver producer and the US’s largest foreign supplier of the metal, providing the country with 21% of its silver needs.
The letter, sent to the Minister of Energy and National Resources Jonathan Wilkinson, is signed by the chief executive officers of Canadian silver producers and explorers including First Majestic Silver (TSX: FR), Dolly Varden Silver Corp (CVE: DV), Endeavour Silver Corp (TSX: EDR) and Silver One Resources (CVE: SVE).
The chief executive officer of the Washington-based Silver Institute is also a signatory.
In December Natural Resources Canada sought submissions to a planned update to Canada’s critical minerals list.
The criteria for admission are that the mineral is essential to Canada’s economic or national security, is required for the country’s transition to a low carbon economy and helps Canada support critical minerals supply to its allies.
Moreover, a case has to be shown that the mineral’s supply is threatened and also has a reasonable likelihood of being produced in Canada.
Silver is a critical component of both photovoltaic (PV) cells and concentrated solar power.
“Its unmatched conductivity benefits PV cells with silver’s utilisation in electrodes in electrodes for most prevalent cell types,” the letter notes.
Generating 1 gigawatt of solar power through PV requires 685,000 ounces of silver.
The metal is also incorporated into rod cluster control assemblies in nuclear reactors and every single electric switch in electric vehicles.
Increasing silver deficits
2022 saw the largest silver deficit on record — 237.7Moz and the deficit for 2023 has been projected at 142.1Moz.
The letter states that global mine production as it now stands will not be able to meet projected future demand for silver.
The Carnegie Endowment for International Peace recently reviewed the geopolitical stability of silver supply, which would fall by 56.5% if country’s with fragile democracies are excluded from global production totals.
The study found significant reserve risks in energy transition requirements with cobalt, graphite, lithium, nickel, silver, tellurium and tin.
“All but silver are currently recognised on Canada’s critical minerals list,” the silver mines noted.
Canadian silver production has declined over the past decade.
This has been brought about by a decline in ore grades, which occurs as silver-rich veins are mined out, leaving only lower grade material for mining.
“Additional exploration is needed to identify new ore bodies,” the letter continues.
“This illustrates the need for concerted silver exploration and development to support Canada’s ability to continue supplying critical silver to the world.”