Mining companies have surpassed technology firms to lead capital raisings in Canada this year
as prices for commodities continue to boom.
Year to date, mining companies listed in Canada have raised $3.1 billion, accounting for 25% of
the total capital raised on the Toronto Stock Exchange (TSX), compared to 18% in the same
period last year, according to market data.
However, the overall amount of capital raised this year has dropped by 54% as stock markets
around the world fall into a correction or bear market. In 2021, technology companies led the
way among equity raises with $13.8 billion, followed by mining at $10 billion, and financial
services at $6.9 billion.
A source of capital for Canada’s mining sector this year is coming from large global corporations
such BHP (BHP) and Rio Tinto (RIO), which are putting money into junior miners to further
exploration projects.
Earlier this month, Australia-based Rio Tinto agreed to pay $10 million for a 10% stake in British
Columbia-based Nano One Materials (NANO), which is engaged in the extraction of lithium. In
February, BHP bought a 5% stake in Vancouver-based copper-gold explorer Filo Mining (FIL)
for $100 million.
Junior miners are also getting a boost from the federal government's plan, announced in this
year's budget, to allocate $4 billion to the exploration and extraction of minerals. The raising of
capital is expected to bolster Canada's market for minerals such as cobalt, lithium, nickel and
copper.
