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by Leonard Melman

Many people seem to be unaware of the vital importance of metals in our lives – and to our economic development as well. Perhaps this point was best illustrated by a narrator’s comment in a National Geographic special on the development of mankind on earth. The discussion was centred on the original development of controlled fire and we were then informed, “Fire gave us metal and metal gave us the modern world.”

That is true, for it is difficult to imagine a world without the common use of metal. A list of some of the obvious uses for a variety of metals might include machinery, furnaces, various appliances, motor vehicles, ships, trains and rails, all manner of scientific and medical instruments, communication devices, computers, cutlery, building construction, plumbing conduits and electrical wiring, writing instruments, wristwatches, pens, tools – the list is almost endless.

And yet, despite the obviously vital role metals play in our society, there remains a sizeable segment of the general population, mainly comprised of people residing in metropolitan areas far removed from actual resource development activities, that seems determined to put a stop to virtually all new mining developments out of concern for environmental purity and/or climate change considerations. Perhaps those people might consider the contributions metals mining makes to our entire economic society, apart from the utility functions of the end products.

These economic contributions were well illustrated by recent comments made by Jim Carr, Canada’s Minister of Natural Resources, in a paper prepared for the Canadian celebration of “National Mining Week” where he noted, “…Today, mineral exploration and mining continue to be rich sources of opportunity and prosperity for our country. Every week, 375,000 Canadians go to work to produce the minerals essential to modern society; from the copper and silver found in cutting-edge medical equipment to the gold and nickel found in smartphones. [Mining] has also been a model of Indigenous engagement, employing more than 10,000 Indigenous people across the country and with close to 380 active agreements between mining companies and Indigenous communities…”

One of the most vital considerations in any discussion of mining’s importance is the simple fact that mining represents the generation of new wealth. This concept is easy to understand when we contemplate the fact that mineral deposits remain out of sight, making no economic or social contributions of any sort until they are dis-covered. Once a prospector obtains clues that a recoverable ore body may exist, it is easy to follow what might be regarded as a normal development path from initial discovery through to successful production.

Once exploration capital is found, initial development work begins, followed by intensive drilling, then after a positive production decision we would see mine construction and, ultimately, production of the metal itself on an economically sound basis. Each of these steps involves the hiring of geologists, office staff, construction personnel, assayers, equipment dealers, drillers, lawyers and accountants, etc. In each case, the monies paid out in wages and equipment purchases results in direct benefits to the general economic community and also results in government taxation revenues which support social welfare programs.

Perhaps of even greater importance, as the metals themselves are sold into world markets, that action brings in huge increments of new wealth, thus providing returns for investors, mine owners, mine workers and others – and that new wealth finds its way not just into the nation’s economic structure but into its fundamental development as well. All one has to do to prove this point is to look at a detailed map of Canada where it will be noted (from east to west) that a host of present-day vibrant communities such as Val d’Or, Rouyn-Noranda, Sudbury, North Bay, Timmins, Kirkland Lake, Red Lake, Flin Flon, Thompson, La Ronge, Fernie, Trail, Cranbrook, Nelson, Quesnel, Princeton and Yellowknife owe their existence to mining.

As noted, residents of our major metropolitan areas tend to be prominent in anti-mining activities as opposed to many rural communities which are much more in tune with natural resource development and therefore the creation of new wealth as opposed to most social or government activities which tend to merely re-distribute already existing wealth. Also, bear in mind that businesses such as casinos transfer existing wealth and don’t create new wealth.

One last consideration is the anticipated fundamental trend of metals prices. On one side, we have forces promoting an evermore expensive and complex regulatory world which acts as an impediment to new ventures, while the forces relating to metals demand continue to grow – as evidenced by the recent news that China has just entered the world of aircraft production with its concomitant demand for metals products.

When diminishing new supply is met by increasing demand factors, basic economics suggest rising future prices and I believe a solid case can be made for that eventuality.

This material is taken from sources believed to be reliable and is provided for information only. Any investment decision should be made only after prior consultation with investment professionals. Leonard Melman is a financial and political writer who focuses on issues relating to the resource sector. Mr. Melman lives in Nanoose Bay, British Columbia, Canada and can be reached at lmelman@


National Mining Week

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