What can Mexico learn from Canada when it comes to critical minerals?

Mexico could follow Canada's lead on critical minerals for the energy transition, BNamericas was told.

While Mexico, the world's leading silver producer, lacks a public policy, Canada's main silver miners are pushing for the metal to be included on the list of critical minerals. A new list of what Mexico’s partner in the USMCA trade agreement considers critical minerals will be published mid-year.

Several Canada-based miners extract silver exclusively from mines in Mexico.

Such is the case of Endeavour Silver, one of the mining companies that signed a letter in January asking the Canadian government to include silver on the list. Endeavour’s Guanaceví and Bolañitos operations are in the states of Durango and Guanajuato, respectively, while it is advancing its US$271mn Terronera project in Jalisco, where initial production is scheduled for 4Q24.

And Sierra Madre Gold & Silver has the La Guitarra project in Mexico state and Tepic and La Tigra in Nayarit.

In the letter sent January 31 to Canada's energy and natural resources minister Jonathan Wilkinson, the CEOs of 19 mining companies, including large producers such as Coeur Mining, Hecla Mining and First Majestic Silver, said considering silver a critical mineral “would further position Canada to be a supplier of choice for critical silver with our strategic allies.” The letter can be seen in the Documents box in the top right of the screen.

One of the arguments expressed in the letter is that “silver is identified as the best electrical conductor, the best metallic thermal conductor and the best reflective material. These qualities make silver an essential and irreplaceable component for many industrial and technological applications.”

However, in Mexico there is no such list or a national policy on minerals, as Luis Humberto Vázquez, president of the country’s association of mining engineers, metallurgists and geologists (AIMMGM), as well as director of mines at Industrias Peñoles, recently told BNamericas.

“We need to see first what’s going to happen in Canada. We’ve always been a little slow to react, but we have to follow the big powers and see what’s best for us to apply what they’re doing,” said Vázquez.

Technologies such as solar energy have led to growing industrial demand for silver. Canadian producers highlighted in the letter that in 2023 global silver demand was estimated at 1.17Boz, of which 576Moz were for industrial use. Photovoltaics required 161Moz last year, or 14% of the total.

Silver is also used in electric and hybrid vehicles. As fleets move towards electrification, demand for silver in the automotive industry is expected to increase.

“Researchers from around the world have raised the alarm that silver is a potential bottleneck in the transition to a low-carbon economy due to supply limitations, disruptions to supply chains, competition for other uses and increased demand,” the letter states.

The president of Mexico’s association of mining engineers, metallurgists and geologists (CIMMGM), Raúl García Reimbert, said although silver is considered a precious metal, it is also critical for Mexico. "I think that's how we should consider it... even though we have, let's say, abundant offers for being the world's leading producer," said García, citing silver’s importance for the Mexican economy.

So far, only in the case of lithium, and to a lesser extent copper, has President Andrés Manuel López Obrador – whose term ends on October 1 – highlighted the opportunity that such strategic metals for the energy transition imply both for the states that produce them, like Sonora in the north, and for the nation in general.