MARKET OVERVIEW

Navigating the Global Demand: Gallium and Critical Minerals

Global Demand

The Power of Gallium Drives Global Economics

Gallium Plays a Unique Role in Modern Military Systems

The United States and other advanced economies purchase gallium from China and refine it further for use in commercial and military applications.

Gallium compounds are key inputs to some advanced U.S. defense systems and, by extension, the DOD supply chain.

Gallium-based semiconductors are vital to the U.S. defense industry, particularly in next-generation missile defense and radar systems, as well as electronic warfare and communications equipment.

GaN (Gallium Nitride) is foundational to nearly all the cutting-edge defense technology that advanced countries produce.

Gallium Market

Gallium Market Analysis

By Market Players, 2022-2023

Global Semiconductor Market Share

By Application

Gallium Market Dominated by Chinese

China has started restricting exports of gallium, which is key to the semiconductor industry, as the chip war with the US and Canada heats up

“Quite simply, if you won’t give us chips, we won’t give you the materials to make those chips”

– Colin Hamilton, BMO Investment

USA & Canada Partnership

Export Restrictions and Pentagon Contract

Due to Chinese export restrictions, the Pentagon plans to issue a first-time contract by year-end to recover gallium—a vital mineral for semiconductors and military radar systems—from U.S. or Canadian companies.

Energy Resource Governance Initiative (ERGI)

Canada and the U.S. signed an MOU confirming Canada’s participation in ERGI, a multi-pronged strategy to reduce reliance on China’s critical energy minerals monopoly.

Resilient Supply Chains

Collaborative efforts between the U.S. and Canada aim to establish a strong, environmentally responsible, and resilient North American critical minerals supply chain.

Investments and Funding

USD $50 million in Defense Production Act funding announced for U.S. and Canadian companies, along with CAD $250 million from Canada’s Strategic Innovation Fund for semiconductor projects.

CHIPS and Science Act Impact

The U.S. and Canada will facilitate investment to bolster secure semiconductor supply chains, creating jobs and advancing a cross-border packaging corridor.

Support for Canadian Companies

Canadian companies in critical minerals for electric vehicles and storage batteries are eligible for USD $250 million Defense Production Act Title III funding.

Chipmaking Making Metals

Critical Elements for Chipmaking Production Linked to LCT Pegmatite Emplacement

Gallium:  Gallum’s most prominent use in technology is in the form of Gallium Arsenide (GaAs), a compound semiconductor. GaAs are highly valued in the electronics industry for its superior electron mobility compared to silicon, making it ideal for high-frequency, high-efficiency applications like mobile phones, satellite communications, microwave point-to-point links, and some radar systems. Additionally, gallium is also used in the production of Gallium Nitride (GaN), another semiconductor with applications in LEDs, laser diodes, and high-power transistors. The unique properties of gallium-based semiconductors, such as their ability to operate at higher temperatures and their efficiency in converting electricity into light, make them critical in the advancement of various electronic and optical devices.

Tantalum: This metal is valued in chipmaking for its high melting point, excellent conductivity, and resistance to corrosion. Tantalum is often used in capacitors and high-power resistors found in semiconductor devices. Its ability to form stable oxide layers makes it ideal for use in thin-film components.

Beryllium: Beryllium is used in certain applications due to its unique properties. It has a high thermal conductivity, which makes it useful in thermal management applications within semiconductor devices. Beryllium is also used in some specialized applications where its light weight and rigidity are beneficial, such as in certain types of aerospace electronics. However, it’s important to note that Beryllium is highly toxic, and its use is highly regulated in manufacturing environments due to the health risks it poses when inhaled as dust or fumes.

Critical Uses

Companies directly affected by chipmaking metals and Supply Chain

Ontario’s Role in Critical Minerals

Abundant Critical Minerals

Ontario, rich in critical minerals, has the potential to integrate into the global critical minerals supply chain.

Thriving Mining Industry

Canada and the U.S. signed an MOU confirming Canada’s participation in ERGI, a multi-pronged strategy to reduce reliance on China’s critical energy minerals monopoly.

Synergy of Resources

Ontario’s extensive mineral wealth in the north aligns seamlessly with a world-class manufacturing sector in the south, creating opportunities for vertical integration.

Government Investments

The Ontario government is investing $24 million in the Ontario Junior Exploration Program, including $12 million for a critical minerals funding stream. An additional $5 million in a new critical minerals innovation fund supports research for extraction and processing in Ontario’s north.

Tax Incentives for Exploration

The Federal Mineral Exploration Tax Credit Program provides a 15% tax credit, complemented by Ontario’s permanent five per cent tax credit for companies exploring in the province through the Ontario Focused Flow-Through Share program.