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2020 was certainly a year like no other with the COVID-19 pandemic causing widespread impacts on everyday life, on economies around the world and the supply chains that interconnect the global business environment. The shifting dynamics over the last 18 months have led to a surge in most commodity prices and the disruptive forces caused by the pandemic may have ripple effects on the mineral industry for several years to come.

Metal Prices

Figure 1 below presents the 2020 year-over-year change of the metal prices PDAC monitors.

Figure 1
Iron Ore was at the top of the chart in 2020 in terms of a year-over-year price change while precious and base metal prices also showed material gains over the year. In contrast, battery metals such as cobalt and lithium recorded the third consecutive year where prices declined. The next set of Figures 2-4 provide a more detailed outline of price dynamics of key metals. 

Figure 2 below presents the spot prices of several key metals from January 2020 until May 2021 and show the upward trends throughout most of this period.

Figure 2

After some initial price shocks in the first months of 2020, as the COVID-19 pandemic began setting in, gold, copper and iron ore gradually trended upwards through the middle part of the year, however, the driving factors were markedly different. 

Monetary and fiscal stimulus actions across many economies provided a tailwind for gold in Q2/Q3 but as vaccine development progressed and the medium-to-long term economic outlook improved globally, the price of gold pulled back from the all-time highs reached in August.

In contrast, copper and iron ore prices were largely being driven by both supply and demand factors. A wide array of operational restrictions resulted from COVID-19, causing supply interruptions from various production centres over the course of the year and stockpiles to deplete. On the other side of the balance, demand for industry materials remained intact through 2020 with the long-term outlook being bolstered by an expedited recovery in China, the progress of vaccinations, and economic stimulus efforts around the world. 

Looking back over the past decade, figure 3 presents the long term price trends of these key commodities, based on monthly average prices.

Figure 3

The figure shows that the trends of these three key commodities (including nickel) take a similar profile with the low-points recorded in late 2015 / early 2016. The impacts of the COVID-19 pandemic appear quite stark in the Figure above and while gold has pulled back from a peak in August 2020, copper and iron ore prices continued higher to reach all-time highs in May 2021.

Finally, figure 4 below present the long term price trends of lithium and cobalt – the two key battery metals.

Figure 4

Battery metal prices continued on a downward trend in 2020, bottoming towards the end of the year. With most economies around the world beginning to reopen in 2021 and with eyes now looking toward ambitious infrastructure and emission reduction plans by various governments, and particularly after the election of President Biden in the U.S., cobalt and lithium prices have surged upward.


Figure 5 shows the share of equity financing raised in Canada throughout the past decade
Figure 5

The amount of equity raised by the mineral sector globally rebounded in 2020 with a nearly 50% year-over-year increase. Despite this notable increase, the total equity raised in markets outside of Canada in 2020 remains well below pre-2018 levels.

There is a silver lining for Canada as 2020 represented the third consecutive year where Canadian exchanges recorded an increase in the proportion of total equity raised for the industry, bringing it to the highest level reached in at least a decade. However, it is important to keep in mind that Canadian exchanges are recording an increased share of a much smaller pie when compared to financing levels pre-2018.

Figure 6 outlines equity financing explicitly for exploration, which follows a similar profile to industry investment shown in the previous figure.

Figure 7

The figure reveals similar dynamics in 2020 with respect to this financing type. A significant improvement in both global and domestic financing (32% and 37%, respectively) provided strong year-over-year rebound - but the total raised in 2020 remained well below levels recorded a decade ago.

The next series of figures (7-10) focus on financing on Canadian stock exchanges. Figure 7 disaggregates between funds raised on the TSX and TSX Venture (TSXV).

Figure 7
Notably, the figure above shows how the improvement in financing in 2020 was not evenly split. TSXV listed issuers accounting for nearly 75% of the year-over-year boost in funds raised. And while the C$4.1 billion raised in TSXV is highest financing number recorded since 2011, the C$3.4 billion raised on the TSX was well below pre-2018 levels.

Figure 8 outlines equity raises in Canada by their sources – private or public funds (public offerings plus IPOs).
Figure 8

After a multi-year decline it is encouraging to see a notable year-over-year increase in funds raised through public offerings in 2020. This should help to broaden and diversify the industry’s investor base. However, the absolute amount of public funds raised in 2020 is still relatively low compared to levels of financing in or before 2016.

 Another notable data point is the high number of equity transactions, as seen in Figure 9 below.
Figure 9

The figure show how the number of equity transactions in 2020 was the highest recorded since 2012. It also shows that the proportion of total funds raised via top 10 largest transactions decreased from ~60% in 2015 to less than 20% in 2020. This shift suggests that an increasing amount of the dollars raised in 2020 were distributed to a broader suite of companies, and implies an improved financing
environment for juniors manifested during the year.

Figure 10 shows that 2020 was very good in terms of FTS financing, with over $900M raised via the FTS mechanism – the highest level since 2011. 

Figure 10

Based on exploration trends outlined in the subsequent figures, increased domestic investment appears to responding to the increase in the gold price throughout 2020 as domestic precious metals exploration activity is up substantially from 2019.

A spark in FTS deals in mid-2020 was likely influenced by the Government of Canada responding to PDAC’s advocacy efforts and deferring timelines associated with FTS funds raised in 2019 and 2020. This decision was in response to the COVID-19 pandemic and provided companies with needed flexibility to access strong equity markets and be confident exploration plans could be executed.

Funds raised using the FTS financing can be spent only in Canada, and therefore have become a very significant source of funding for exploration in Canada, with ~70% of the funds obtained through this mechanism. Moreover, for sub-$20 million transactions, which are more typical for junior exploration companies, the proportion of funding sourced from FTS increases to nearly 80%.

Exploration Expenditure

The last series of figures (11-14) show trends related to the use of the proceeds on exploration activities. First, Figure 11 presents global exploration expenditure, disaggregated by region.

Figure 11
The figure reveals that global exploration activity in 2021 is projected to increase by 35% year-over-year. This increase is the first in several years and can be largely attributed to the upward price trend for most commodities and a more robust financing environment in 2020.

Exploration spending in Canada is set to climb by over 60% in 2021 from a year prior, and the proportion of global expenditures directed towards Canada has moved up to approximately 19%, well above the low-point recorded in 2013.
The next two figures address global and Canadian global exploration activity from two different perspectives. Figure 12 presents global and domestic exploration spending in 2008 and 2020, disaggregated by on project stage.

Figure 12
The figure reveals a long-term decline in the amount of global spending on grassroots projects, both globally and domestically. 2020 represents a new low for Canadian grassroots exploration spending and the first time it has been proportionally lower than activity abroad.

Figure 13 below disaggregates exploration expenditures by company type. 
Figure 13

It’s also important to note the similar long-term decline in the proportion of spending that comes from junior exploration companies. This downward trend has been recognized both in Canada and abroad.

Lastly, Figure 14 presents exploration expenditures in Canada by province. 
Figure 14
Although investment in grassroots activity has been waning, exploration in Canada is set to accelerate. For 2021, NRCan estimates a 40% year-over-year increase in Canadian exploration spending, which is more modest that the S&P data shown in Figure 11 but still the largest increase recorded in a decade. However, under a two year term comparison (2021 vs. 2019), half of the regions in Canada will see exploration activity below pre-pandemic levels. This impact is seen most acutely in the territories, where exploration spending is projected to be down over 35% on average over this two-year period.

As a final note, Québec stands out relative to all other regions in Canada in 2021, as mineral exploration activity is expected to nearly double from a year ago and could account for one-third of all domestic spending in 2021. While the increase in gold price is likely a significant driver behind the increase of activity in Québec, we are also likely seeing the results of proactive mineral development and infrastructure policies, as well as institutional frameworks that have been established in the province.


The figures in this report are based on PDAC analysis of data sourced from S&P Global Market Intelligence, TMX Group and Natural Resources Canada (NRCan). 

1. Metal Prices (Figures 1-4): S&P Global Market Intelligence and PDAC analysis 
2. Financing (Figures 5-10): 
 • Figures 5-6:  S&P Global Market Intelligence and PDAC analysis
 • Figures 7-9: TMX Group and PDAC analysis 
 • Figure 10 – TMX Group, S&P Global Market Intelligence and PDAC analysis
3. Exploration Expenditures (Figures 11-14):
 • Figures 11-13: S&P Global Market Intelligence and PDAC analysis
 • Figure 14: NRCan and PDAC analysis