Trade and Finance
Uncertainty reigns
It was virtually unthinkable just a year ago – but an intensifying US-Canada trade conflict, and a consequent wider sense of business uncertainty, are hurting the Canadian economy. With US trade policy defined by unpredictability in early 2025, as president Donald Trump vacillated between sweeping tariffs, special conditions, trade deals and U-turns, businesses across Canada reined in their investments and sales outlooks. Canadian exports to the US – overwhelmingly its largest trading partner constituting 77% of its total exports by value in 2023 – fell by 15.7% from March to April 2025, as its exports to the rest of the world rose by 2.9%. Resultantly, Canada recorded a CA$7.6 billion trade deficit in April – its largest on record.
All that was before US tariffs on Canadian steel and aluminum import tariffs doubled to 50% in early June, piling further pressure on Canadian suppliers, as President Trump continued in his attempts to aggressively rebuild manufacturing capacity in the US. The two countries’ bilateral mineral trade had reached CA$146 billion in 2023, with Canada’s exports comprising CA$83.8 billion of that total, including CA$20 billion of iron and steel, and CA$15.2 billion of aluminum.
Tensions between the two countries have continued to rise, with Canada responding with tariffs of its own. Months of “will-they, won’t-they” high-level trade discussions appeared to have passed beyond breaking point in late June 2025, before Canada dropped a planned tax on US big tech digital services in order to resume talks. In early September, the Canadian government dropped many of its retaliatory tariffs, with Carney signalling intent to return to trade negotiations.
Mining, of course, is a long-term game. It is possible that tariff policies and uncertainty will fade away before many of the projects discussed in this report produce their first metals. Given the undulating trajectory of trade policy under the Trump administration, it is difficult to predict what will happen even in the coming weeks. The impacts on Québec and Atlantic Canada’s mining industries, meanwhile, will not be clear for months, or perhaps years, as effects ripple across highly integrated supply chains. Eastern Canada is certainly highly exposed to trade disruptions, with over 70% of Québec and New Brunswick’s exports sent to the US in 2023. With some economists forecasting a looming Canadian recession as tariffs pour fuel on smoldering inflation and unemployment, one thing remains abundantly clear: all this uncertainty is bad for business.
While juniors struggle, investors look the other way
There is no easy way to say it – Québec and Atlantic Canada’s junior mining companies, for the most part, are in dire straits. Although this region has a few standout success stories, the sentiment across the industry is broadly the same: despite excellent short-to-medium term outlooks for a range of critical minerals, and record prices for gold, junior stocks are trading at historic lows, leaving their operations high and dry. Mathieu Savard, president and CEO of gold explorer Vior, said plainly that many junior companies were “starving for funding” in 2025.
Left unresolved, this deepening challenge could become an existential one for mining. Juniors act at the exploration arm of the mining industry, creating value through new discoveries. Without those discoveries, it will be impossible for the industry to meet the projected explosive demand for critical minerals, nor to replace depleting gold reserves. David Garofalo, CEO of royalty and streaming company Gold Royalty, outlined the scale of the problem: “One of the mining industry’s greatest challenges over the past decade has been the lack of capital available to junior explorers – the very companies responsible for grassroots discoveries that drive long-term growth.”
Paul Carmel, president and CEO of Montréal-based, Québec government-sponsored junior funder Sidex, branded the issue one of “investor apathy.” In many cases, a downward spiral effect is taking hold: with little investment, juniors struggle to explore; without exploring, they cannot generate results; and without results, they have a hard time attracting investors. This becomes particularly difficult when in concert with other recent challenges facing the sector at large. “Mining has become an increasingly challenging business due to lengthy permitting processes, rising costs, skilled labour shortages, and growing community opposition – even in traditionally pro-mining regions,” said Carmel.
"Market conditions have been challenging. While we would love to have US$10 to US$20 million to advance all of our projects, that is not our current reality. We hope the market improves, and we continue to push ahead with strategic and focused efforts." Tim Froude, President and CEO, Sokoman Minerals
Juniors are also suffering a low investor appetite for risk, following years of geopolitical upheaval, inflation, high interest rates and global uncertainty. Investment has flocked to safe haven assets like gold, once again leaving the inherently risky junior mining business out in the cold. A defining feature of many recent junior success stories is their scale, with inflated up-front costs necessitating a greater potential return on investment. For investors, proven scale offers a degree of certainty – and majors’ active production even more so. “Much of the capital entering the sector comes from generalist investors focused on return rather than sector-specific dynamics. Given their higher risk profile, juniors are often overlooked by these investors,” explained Olivier Grondin, chairman of AEMQ, the association representing Québec’s mining exploration companies.
The effects for juniors in Québec and Atlantic Canada are real, and profound. “Market conditions have been challenging. We began 2024 with one-third of the previous year’s treasury. While we would love to have CA$10-20 million to advance all of our projects, that is not our current reality,” said Tim Froude, president and CEO of Newfoundland and Labrador-based polymetallic junior Sokoman Minerals.
Yet, some still showed optimism for the future, reasoning that those juniors able to weather the storm will reap great benefits. “This lack of activity will constrain future mine supply – which, ironically, sets the stage for the next upcycle,” maintained Ivan Fairhall, managing director of Québec-focused copper explorer Pivotal Metals. Impactful infrastructure investment
Something of a bright spot for mining financing in Québec and Atlantic Canada in 2025 came in the announcement of a potential new source of government funding: the First and Last Mile Fund (FLMF). Announced by Canadian Prime Minister Mark Carney in March 2025, the FLMF will provide critical minerals projects, as well as other in the energy sector, with federal funding to build out infrastructure linking their sites with pre-existing transport links. “We are going to aggressively develop projects that are in the national interest in order to protect Canada’s energy security, diversify our trade, and enhance our long-term competitiveness, all while reducing emissions,” pledged Carney in the Fund’s announcement, which came in the run-up to Canada’s federal election, during which Carney’s campaign was buoyed by his focus on Canadian national security in the face of its changing relationship with the U.S.
The FLMF adds another arm to Canada’s robust suite of government-sponsored investment sources for critical mineral and energy projects, which also includes the Canada Growth Fund (CGF), Export Development Canada (EDC) and the Critical Mineral Infrastructure Fund (CMIF). The CA$1.5 billion CMIF was launched in late 2023, with then-Minister of Natural Resources Jonathan Wilkinson hailing critical mineral development as a “generational economic opportunity” for Canada. It offers funding to support project development including economic studies, plans and Indigenous engagement, as well as clean energy and transportation infrastructure projects, with a goal to accelerate Canada towards critical mineral production.
"Given the high infrastructure costs, combining funding sources is essential. Société du Plan Nord informs developers about available federal and provincial tools, ensuring projects access the necessary resources." Patrick Beauchesne, CEO, Société du Plan Nord
These federal funds are further complemented at the provincial level. Two of Québec’s own funds – the Plan Nord and NQ Investissement Minier – take a close focus on the province's north, where critical mineral prospects are plenty, but infrastructure is sparse. Sylvain Lépine, general manager of NQ Investissement Minier, explained how region’s mineral potential can be unlocked through wise investment: “It is not enough to identify mineral projects; we need to connect those projects with roads, electricity and essential services.”
Both Lépine and Patrick Beauchesne, CEO of Société du Plan Nord, which implements projects using Plan Nord funding, agreed that coordination between federal and provincial funds is key. “Given the high infrastructure costs, combining funding sources is essential,” said Beauchesne.
The Atlantic provinces also offer provincial-level funding, even if not at the same scale as in Québec. With its larger industry, Newfoundland and Labrador unsurprisingly offers the most. Funding for exploration and critical mineral-focused projects include the Junior Exploration Assistance program totaling CA$3.9 million in the 2024/25 budget, and Green Transition Fund, which helps projects to reduce their environmental impact. In Nova Scotia, the government’s Mineral Resources Development Fund provides up to CA$1.5 million per year in grants for activities including prospecting, education, innovation and community support. Tim Houston expressed his openness to raising that figure, based on industry needs. The provincial government also allocated CA$500,000 in its 2025/26 budget to the advancement of its Critical Minerals Strategy. Finally, New Brunswick’s government delivers its Junior Mining Assistance Program, offering grants up to CA$100,000, and Prospect Assistance Program, with grants up to CA$15,000.
Through 2024, tens of millions of Canadian dollars in federal funding was announced for several projects across Québec and Atlantic Canada, including the likes of rare earth developer Torngat Metals, lithium developer Critical Elements Lithium Corporation, lithium producer Sayona (now Piedmont Lithium), and FireFly Metals’ copper mine restart project in Newfoundland. The funds are helping these important projects and operations to progress, despite the various headwinds described throughout this article. Amyot Choquette, senior director for natural resources investments at Investissement Québec, summarized these funds’ importance: “Greater federal engagement, through initiatives such as the CGF, CMIF, and support from agencies like EDC, is a clear advantage for mining projects during these uncertain times.”
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