By Anam Khan
Updated: March 10, 2026
Canada’s battery supply chain story has a weak link: graphite.
Even if Canada mines lithium and builds battery plants, electric vehicles still need a lot of graphite for the anode, and most battery-grade processing is concentrated in China, which refines 90 per cent of the world’s supply.
Now, there is a concrete Canadian move to bring the refining process home.
Canadian mineral exploration company Nouveau Monde Graphite is backed by government funding and has supply deals with major buyers.
“We cannot just once again repeat the model that’s been used in the past, where we extract the resource, send it elsewhere to be refined and then purchase it back,” said Julie Paquet, a spokesperson for Nouveau Monde Graphite (NMG).
Last month, the company secured a binding offtake agreement and a US$25 million investment from Panasonic Energy to support its Phase-2 Matawinie Mine and Battery Material Plant in Bécancour, Que.
Panasonic agreed to buy 13,000 tonnes of active anode material per year.
NMG also signed a deal to supply 18,000 tonnes per year of battery-ready anode material to General Motors.
Canada has the world’s 10th-largest graphite reserves, according to Natural Resources Canada.
Those deals matter because they help Canada move faster to build out its own supply chain, says Max Yerrill, a critical minerals analyst at BMO Capital Markets.
He says by increasing its graphite capacity and suppressing global prices, China has kept competitors out. It also used its leverage in the critical minerals markets, specifically graphite, and put export restrictions on it, creating a significant strategic vulnerability for Canada’s green energy goals.
“So building graphite in our own backyard is a huge strategic advantage, because it helps us maintain sovereignty,” says Yerrill.Canada unlocks $12B in critical mineral deals as minister calls supply chains ‘national security’
‘Huge stamp of approval’
These high-profile deals put Canada’s graphite sector on the map as a legitimate global player, explains Yerrill.
Panasonic Energy is a key battery supplier to major automakers, including Tesla.
“When a company like Panasonic is willing to partner with a Canadian company, it’s a huge stamp of approval,” he said, adding that the process for Panasonic to buy graphite can take years.
“It signals to the market that they’ve done their homework. They know what they’re doing.”
Canada’s battery supply chain story has a weak link: graphite.
Even if Canada mines lithium and builds battery plants, electric vehicles still need a lot of graphite for the anode, and most battery-grade processing is concentrated in China, which refines 90 per cent of the world’s supply.
Now, there is a concrete Canadian move to bring the refining process home.
Canadian mineral exploration company Nouveau Monde Graphite is backed by government funding and has supply deals with major buyers.
“We cannot just once again repeat the model that’s been used in the past, where we extract the resource, send it elsewhere to be refined and then purchase it back,” said Julie Paquet, a spokesperson for Nouveau Monde Graphite (NMG).
Last month, the company secured a binding offtake agreement and a US$25 million investment from Panasonic Energy to support its Phase-2 Matawinie Mine and Battery Material Plant in Bécancour, Que.
Panasonic agreed to buy 13,000 tonnes of active anode material per year.
NMG also signed a deal to supply 18,000 tonnes per year of battery-ready anode material to General Motors.
Canada has the world’s 10th-largest graphite reserves, according to Natural Resources Canada.
Those deals matter because they help Canada move faster to build out its own supply chain, says Max Yerrill, a critical minerals analyst at BMO Capital Markets.
He says by increasing its graphite capacity and suppressing global prices, China has kept competitors out. It also used its leverage in the critical minerals markets, specifically graphite, and put export restrictions on it, creating a significant strategic vulnerability for Canada’s green energy goals.
“So building graphite in our own backyard is a huge strategic advantage, because it helps us maintain sovereignty,” says Yerrill.Canada unlocks $12B in critical mineral deals as minister calls supply chains ‘national security’
‘Huge stamp of approval’
These high-profile deals put Canada’s graphite sector on the map as a legitimate global player, explains Yerrill.
Panasonic Energy is a key battery supplier to major automakers, including Tesla.
“When a company like Panasonic is willing to partner with a Canadian company, it’s a huge stamp of approval,” he said, adding that the process for Panasonic to buy graphite can take years.
“It signals to the market that they’ve done their homework. They know what they’re doing.”
Jumbo flakes of graphite from Nouveau Monde Graphite’s Phase 2 Matawinie Project (Credit: Nouveau Monde Graphite)
The Japan-based company, which operates globally, told BNN Bloomberg it is focusing on building a stable and resilient supply chain in North America while also reducing its carbon footprint.
“We have set a medium- to long-term goal of achieving a 50 per cent local procurement rate in North America,” a Panasonic spokesperson said in an email.
Paquet says NMG is already seeing domestic interest and that the Canadian government is providing a framework to secure supplies.
Canada is copying China’s strategy
China’s critical mineral industry has grown massively because it gives huge subsidies to its domestic producers, “which has allowed them to continue to operate at rock-bottom commodity prices,” says Yerrill.
“What we’re seeing is the Canadian government is doing the same thing. We’re providing incentives, financing, price support for our domestic producers in order to avoid the supply chain reliance,” says Yerrill.
NMG is heavily backed by government support as Canada moves to secure critical mineral supplies.
The Matawinie Mine, which is 120 km north of Montréal, Que., was selected as one of the projects by the government’s Major Project Office last year. The office identified the mine as part of Canada’s “strategy to be a powerhouse in the extraction and upgrading of critical minerals.”Five things to know about Quebec graphite mine added to major projects list
The Japan-based company, which operates globally, told BNN Bloomberg it is focusing on building a stable and resilient supply chain in North America while also reducing its carbon footprint.
“We have set a medium- to long-term goal of achieving a 50 per cent local procurement rate in North America,” a Panasonic spokesperson said in an email.
Paquet says NMG is already seeing domestic interest and that the Canadian government is providing a framework to secure supplies.
Canada is copying China’s strategy
China’s critical mineral industry has grown massively because it gives huge subsidies to its domestic producers, “which has allowed them to continue to operate at rock-bottom commodity prices,” says Yerrill.
“What we’re seeing is the Canadian government is doing the same thing. We’re providing incentives, financing, price support for our domestic producers in order to avoid the supply chain reliance,” says Yerrill.
NMG is heavily backed by government support as Canada moves to secure critical mineral supplies.
The Matawinie Mine, which is 120 km north of Montréal, Que., was selected as one of the projects by the government’s Major Project Office last year. The office identified the mine as part of Canada’s “strategy to be a powerhouse in the extraction and upgrading of critical minerals.”Five things to know about Quebec graphite mine added to major projects list
Rendering of Nouveau Monde Graphite’s Phase-2 Matawinie Mine. The project is designed for a 25-year life of mine with a planned production of approximately 106,000 tonnes per annum (tpa) of graphite concentrate. (Credit: Nouveau Monde Graphite).
The Canada Growth Fund (CGF) said it invested US$25 million in Nouveau Monde in December 2024 as part of a US$50 million private placement alongside Investissement Québec to support pre-final investment decision spending.
A spokesperson for CGF told BNN Bloomberg that its investment in NMG “is the only one it has made to date in the graphite sector.”
Yerrill says money is always an issue when building a new mining and refining process.
“It’s a huge de-risking event for that company because they know there’s a backer with deep pockets that’s willing to help them get into production,” says Yerrill.
Paquet said Nouveau Monde is aiming to launch construction on the Matawinie mine this spring, with commercial production expected by late 2028. Paquet said the Bécancour battery material plant would follow, with the goal of starting commercial-scale production around early 2029.
Anam Khan
The Canada Growth Fund (CGF) said it invested US$25 million in Nouveau Monde in December 2024 as part of a US$50 million private placement alongside Investissement Québec to support pre-final investment decision spending.
A spokesperson for CGF told BNN Bloomberg that its investment in NMG “is the only one it has made to date in the graphite sector.”
Yerrill says money is always an issue when building a new mining and refining process.
“It’s a huge de-risking event for that company because they know there’s a backer with deep pockets that’s willing to help them get into production,” says Yerrill.
Paquet said Nouveau Monde is aiming to launch construction on the Matawinie mine this spring, with commercial production expected by late 2028. Paquet said the Bécancour battery material plant would follow, with the goal of starting commercial-scale production around early 2029.
Anam Khan
Journalist, BNNBloomberg.ca
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