Ontario Has a Critical Minerals Advantage, but Risks Losing the Full Value Potential

By Hina Ahmed
CCI Director of Ontario Affairs

Globally, the critical minerals sector is expected to exceed $700 billion by 2035. Ontario begins with a structural advantage most jurisdictions would envy, as one of the richest concentrations of critical minerals in the world. The province holds 35 critical minerals and metals that underpin the modern economy and will determine who leads the next industrial era. Batteries, semiconductors, advanced manufacturing, defence systems: these are all industries that will define the next century, and both federal and provincial governments are moving to build Canadian supply chains that will enable this transition.

However, taking rocks out of the ground is not the same as building long-term economic value. If we treat critical minerals as a narrow extraction play, we'll end up as price-takers at the bottom of someone else's value chain. The real value lies in owning the intellectual property, technology and data that will be key in becoming global leaders in this sector across the value chain.

The intention to be bold is built into Ontario's next step in the development of its Critical Minerals Strategy. As Minister of Energy and Mines Stephen Lecce says in his opening letter, “Ontario’s prosperity and economic sovereignty will be defined by the choices we make today.”

A central feature of the strategy must be full supply chain value capture, spanning processing, recycling, and manufacturing, with economic benefits anchored in Canada from the outset. If Ontario wants to lead, it must think in terms of becoming the global epicentre for mining innovation and scale, where companies build, commercialize, and expand into global markets from a Canadian base.

A credible strategy must be grounded in how the sector actually operates: long capital cycles, procurement constraints, global price pressure, and ensuring the persistent loss of intellectual property from Canada through acquisition and migration is mitigated.

Through discussions with mining innovation leaders in Ontario, including Hatch and Cyclic Materials, a clear set of priorities have emerged:

First, unlock geological data by harmonizing standards. Information is the foundation of innovation. Today, exploration teams are burdened with data cleaning and reconciliation rather than mineral discovery. Standardized datasets would remove unnecessary friction in the system and accelerate exploration activity across the province. More exploration leads to more discoveries, more projects, and greater long-term production capacity.

Second, recognize intangible assets as core economic drivers. Data, software, and intellectual property now sit at the centre of mining competitiveness. Yet Canadian innovation is still too often acquired and owned abroad. A targeted IP strategy must protect domestic firms, reduce value leakage, and ensure IP creation and ownership is anchored in Canada.

Third, incentivize Canadian supply chains. Supply chains are tightening for national security reasons. Defence and advanced technologies require secure, guaranteed supply. Traceability now functions as both economic and security infrastructure, positioning Ontario as a trusted supplier, not just a resource base. Foreign processors still routinely outbid Canadian firms for domestic materials. Offtake agreements and price floors are essential to risk demand and create  market-making functions.

Cyclic Materials recovers rare earth elements and other critical materials from end-of-life products. They share that, “Domestic rare earth recycling can reduce supply chain risk by creating an immediate and reliable source of critical materials independent of foreign suppliers, protecting key sectors of the economy including automotive manufacturing, AI, energy infrastructure, and national security.”

Fourth, modernize capital incentives with a dedicated Mining Exploration Tax Credit. Ontario’s current 5% flow-through credit is not competitive. A British Columbia–style credit, stacked with federal incentives, would send a clear signal that Ontario is serious about competing for exploration capital and understands the sector’s risk profile.

As Hatch has shared, “A competitive critical minerals economy is about more than extraction. It depends on the engineering, processing, automation, and specialized services that make projects viable. Ontario’s strategy should reflect that full value chain and build on the province’s strengths to capture greater growth and long-term economic benefit.”

The stakes couldn't be higher. Every decision we make either builds Ontario's long-term economic advantage or outsources it to jurisdictions that capture the high-value processing, technology, and intellectual property. Critical minerals must be treated as a matter of industrial competitiveness, not just resource extraction.

If Ontario wants to lead, it must govern with the intent to own more than what comes out of the ground. Otherwise, the full economic value will be captured elsewhere.
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About the Council of Canadian Innovators

The Council of Canadian Innovators is a national member-based organization reshaping how governments across Canada think about innovation policy, and supporting homegrown scale-ups to drive prosperity. Established in 2015, CCI represents and works with over 175 of Canada’s fastest-growing technology companies. Our members are the CEOs, founders, and top senior executives behind some of Canada’s most successful ‘scale-up’ companies. All our members are job and wealth creators, investors, philanthropists, and experts in their fields of health tech, cleantech, fintech, cybersecurity, AI and digital transformation. Companies in our portfolio are market leaders in their verticals, commercialize their technologies in over 190 countries, and generate between $10M-$750M in annual recurring revenue. We advocate on their behalf for government strategies that increase their access to skilled talent, strategic capital, and new customers, as well as expanded freedom to operate for their global pursuits of scale.