The Canadian banking sector is under pressure to balance financial growth with sustainability. The Big Five banks of the country – Royal Bank of Canada (RBC), Bank of Montreal (BMO), Bank of Nova Scotia (Scotiabank), TD Bank, and Canadian Imperial Bank of Commerce (CIBC) – have all reported their latest earnings while advancing their climate commitments.

The Big Five banks’ financial results reflect the strength of the Canadian economy, while their sustainability and net-zero initiatives show how committed they’re to reducing carbon emissions.

But how do these Canadian banks compare? Let’s dive into their latest earnings and see who is leading the charge toward a greener future.

Financial Performance: A Competitive Landscape

Royal Bank of Canada (RBC): Record Earnings with Strong Performance

RBC reported a net income of CAD 5.13 billion in Q1 2025, up from CAD 3.52 billion in Q1 2024. Adjusted earnings per share (EPS) stood at CAD 3.62, surpassing analyst expectations of CAD 3.24.

• Revenue: CAD 16.74 billion (up from 13.49 billion year-over-year)
• Net Interest Margin (NIM): Not explicitly stated in available reports
• Provision for Credit Losses (PCL): CAD 1.05 billion (up from 815 million)

RBC’s financial performance was bolstered by a strong wealth management division, which saw a 48% increase in income, and robust capital markets earnings. The acquisition of HSBC Bank Canada contributed an additional CAD 214 million to net income. 

Bank of Montreal (BMO): Solid Growth Amid Economic Challenges

BMO reported a net income of CAD 2.14 billion in Q1 2025, up from CAD 1.29 billion in Q1 2024. Adjusted earnings per share (EPS) stood at CAD 3.04, surpassing analyst expectations of CAD 2.41.

• Revenue: CAD 7.28 billion (up from 6.22 billion year-over-year)
• Net Interest Margin (NIM): Not explicitly stated in available reports
• Provision for Credit Losses (PCL): CAD 573 million (slightly down from 585 million a year ago)

BMO’s financial performance was strong despite higher credit provisions. Its capital markets division contributed significantly, with a 45% increase in adjusted net income, reaching CAD 591 million.

Bank of Nova Scotia (Scotiabank): Facing Margin Pressure

Scotiabank’s Q1 2025 net income stood at CAD 2.02 billion, slightly lower than CAD 2.12 billion in Q1 2024. Adjusted EPS was CAD 1.68, missing expectations of CAD 1.70.

• Revenue: CAD 8.16 billion (down slightly from 8.23 billion)
• Net Interest Margin: Not explicitly stated in available reports
• Provision for Credit Losses: CAD 955 million (up from 910 million)

While Scotiabank saw modest revenue growth, higher loan loss provisions and lower NIMs affected profitability. The bank’s Latin American operations performed well, helping offset domestic weakness.

TD Bank: Strong Performance Despite Loan Losses

TD Bank announced a net income of CAD 2.79 billion in Q1 2025, a slight decline from CAD 2.82 billion in Q1 2024. Adjusted EPS was CAD 1.55, remaining flat year-over-year.

• Revenue: CAD 14.05 billion (up from 13.71 billion)
• Net Interest Margin: Not explicitly stated in available reports
• Provision for Credit Losses: CAD 1.21 billion (up from 1.02 billion)

TD’s performance was driven by strong deposit growth and capital markets revenue. However, increased provisions for credit losses reflect potential economic headwinds.

CIBC: Higher Earnings But Growing Risks

CIBC posted a Q1 2025 net income of CAD 2.18 billion, up from CAD 1.73 billion in Q1 2024. Adjusted EPS was CAD 2.20, above the consensus estimate of CAD 1.81.

• Revenue: CAD 7.3 billion (up from 6.14 billion)
• Net Interest Margin (NIM): Not explicitly stated in available reports
• Provision for Credit Losses (PCL): CAD 573 million (down from 585 million)

CIBC’s earnings growth was supported by strong loan and deposit growth. Its capital markets unit saw a 19% increase in net income, reaching CAD 619 million. However, rising provisions for bad loans signal caution.

Carbon Emission Reductions and Sustainability Race: Who’s Leading?

As these Big Five Canadian banks are going after profits, they, too, are under pressure to go after their sustainable and net-zero goals. Let’s see what they’re doing to hit their climate goals.

Royal Bank of Canada (RBC): Advancing Towards Net Zero

RBC has pledged to achieve net-zero emissions in its operations and financed emissions by 2050. The bank is aligning its lending and investment activities with global climate targets, focusing on energy efficiency, sustainable finance, and emissions reductions.

RBC’s GHG emissions totaled 119,802 metric tons of CO₂e in 2023, reflecting a steady decline from previous years. The bank has committed CAD 500 billion in sustainable finance by 2025.

As of 2023, RBC has allocated CAD 393 billion in sustainable finance, making progress toward its CAD 500 billion target by 2025.

The most valuable bank in Canada also used carbon offsets as part of its strategy to neutralize its operational footprint. 

Key emission reduction initiatives are:

• Expanding financing for renewable energy and clean technology projects.
• Increasing investments in green buildings and energy-efficient operations.
• Strengthening partnerships in climate finance and transition investments.
• Supporting industries in their transition to a low-carbon economy.

RBC remains committed to climate risk management and improving transparency in its sustainability disclosures. The bank continues to refine its financed emissions tracking and collaborates with businesses to meet shared net-zero goals.

Bank of Montreal (BMO): Charging its Net-Zero Ambitions

BMO has committed to achieving net-zero emissions in its operations by 2050. The bank has been carbon-neutral in its operations since 2010 and aims to cut its Scope 1 and 2 emissions by 30% by 2030 (from a 2019 baseline). The bank has achieved this by:

• Upgrading heating and cooling infrastructure across its buildings.
• Purchasing renewable energy certificates (RECs) to match 100% of its global electricity consumption.
• Offsetting residual emissions through high-quality carbon credits, including projects like the Great Bear Rainforest conservation initiative..

In 2023, the bank’s total greenhouse gas (GHG) emissions stood at 101,960 metric tons CO₂e, down 12% from 2022 levels. The bank retired 45,918 tCO₂e of carbon credits in the same year as part of its emission reduction strategies. 

Major climate actions include:

• Issued CAD 10 billion in sustainability bonds.
• Financed CAD 70 billion in sustainable lending projects.
• Pledged to provide CAD 150 billion in green financing by 2025.
• BMO’s Asset Management division offers multiple sustainable investment options, focusing on ESG-oriented portfolios.

BMO has pledged CAD 300 billion in sustainable financing and has surpassed this with CAD 330 billion issued as of 2023. 

The giant financier aims to support businesses transitioning to a low-carbon economy. In 2023, the bank expanded its emissions tracking for lending portfolios, including commercial real estate, and continues to refine its sustainability-linked lending framework.

Bank of Nova Scotia (Scotiabank): Carbon Intensity Reduction

Scotiabank aims for net-zero financed emissions by 2050 and a 40% reduction in operational emissions by 2030. In 2023, its operational carbon emissions were 110,000 metric tons CO₂e, down 9% year-over-year.

“font-weight: 400;”>>The Canadian bank has reduced energy consumption in branches and offices by 25% as part of its net-zero efforts. It has also financed low-carbon initiatives in Latin America

Scotiabank has set a target of providing CAD 350 billion in climate-related financing by 2030. In 2023, the bank provided CAD 36 billion toward this goal, bringing its cumulative total to CAD 132 billion since 2018.

Key climate initiatives include:

• Developing an internal net-zero scoring system to assess client transition plans.
• Setting interim emissions intensity reduction targets for the automotive manufacturing sector.
• Intending to increase internal carbon price to further emission reductions.
• Expanding financing solutions for renewable energy projects and electric vehicle adoption.

The bank also continues to reduce its own operational emissions by securing emissions-free electricity, implementing energy efficiency programs, and integrating climate risk assessments into its lending strategy.

TD Bank: Leading in Sustainable Finance and Decarbonization

TD Bank has the most aggressive green finance strategy among the four banks. It has pledged CAD 500 billion in sustainable and decarbonization finance by 2030, with nearly CAD 70 billion allocated in 2023 alone. 

TD has emitted a total of 117,317 metric tons of CO₂e in 2023, down 14% from 2022. The bank has already achieved a 28% reduction in operational Scope 1 and 2 emissions, surpassing its 2025 target of 25%.

The bank has retired 85,176 verified carbon reduction and removal credits, equal to the bank’s market-based Scope 1 and 2 emissions and Scope 3 category 6 (business travel) emissions.

More notably, the bank has one of the largest direct air capture (DAC) carbon credit purchases in the financial sector. It agreed to buy 27,500 metric tons of carbon removal credits over four years.

• RELATED: What Is Carbon Dioxide Removal? Top Buyers and Sellers of CDR Credits in 2024

Also, TD Bank has expanded its financial emissions tracking across nine high-emission sectors, including energy, automotive, and agriculture. The financier has also improved climate risk assessment tools and developed a central data repository to track emissions reduction progress across its operations and client portfolio.

Other Sustainability Highlights:

• Launched the first net-zero branch in Canada, 
• Invested CAD 20 million in community-based climate projects, and
• 60% of power is sourced from renewable energy.

CIBC: Balancing Growth and Sustainability

CIBC is committed to reducing its Scope 1 and 2 emissions and achieving net zero. In 2023, its operational emissions stood at 71,031 metric tons CO₂e, a 5% increase from 2022.

Per CIBC’s sustainability report, the bank has set a 30% operational GHG reduction target by 2028 (compared to 2018 levels). It also aims to achieve carbon neutrality in operations by 2024. The bank is on track to meet this target through:

• Increasing investments in renewable energy.
• Expanding sustainable finance offerings, including carbon capture, hydrogen, and e-mobility financing.
• Implementing energy-efficient technologies in offices.
• Partnering with carbon capture firms for carbon offset projects.
• Enhancing transparency in climate risk reporting and engaging with industry groups 

The bank has issued over CAD 157 billion in sustainable finance investments as of 2023. It has a target of 300 billion by 2030. 

CIBC helped finance sustainable infrastructure projects. This includes battery energy storage systems in the UK and big renewable energy deals.

Who’s Winning the Net Zero Race?

With all the sustainability initiatives and financing solutions provided by each bank, who wins the net-zero race? The chart below shows the comparison of the banks’ GHG emissions and sustainable finance progress as of 2023. 

Overall, TD Bank and RBC lead with the highest sustainable finance commitment, while BMO has surpassed its financing goal. RBC is also making significant strides in sustainable finance and net-zero initiatives, leveraging its market leadership.

CIBC has made strong progress in both emissions reductions and sustainable investments. Meanwhile, Scotiabank continues expanding its climate financing but has the third-highest operational emissions among the five banks.

Conclusion: Balancing Profitability with Climate Commitments

The five major Canadian banks continue to navigate economic headwinds while strengthening their sustainability and net-zero initiatives. While financial results varied, all banks have made progress in decarbonization efforts, sustainable finance, and emissions reductions.

• RBC leads in net income and is expanding climate finance and net-zero initiatives.
• BMO remains a leader in carbon-neutral operations and financed emissions tracking.
• Scotiabank is aggressively expanding climate-related finance and client net-zero assessments.
• TD Bank is surpassing emissions reduction targets and making innovative carbon credit investments.
• CIBC is strengthening its renewable energy financing and operational net-zero transition.

As regulatory pressure and investor expectations increase, these Big Five Canadian banks will need to accelerate their climate and net-zero strategies while maintaining profitability. Future progress will depend on expanding sustainable finance, improving emissions tracking, and supporting client transitions to a low-carbon economy.

• READ MORE: First the Americans, Now the Canadians: What Banks Are Making an Exodus from NZBA?

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Wells Fargo, one of the largest financial institutions in the United States, has made a significant shift in its climate strategy by abandoning its commitment to achieving net-zero financed emissions by 2050. It is the first major U.S. bank to do so. 

The bank has also dropped its interim 2030 targets for financed emissions. This is a big step back from its earlier climate goals. This decision fits a larger trend: Major financial institutions are changing their sustainability strategies, responding to outside pressures like political challenges and economic facts.

Why Wells Fargo Abandoned Its 2050 Net Zero Pledge

In a formal statement, Wells Fargo announced that it was discontinuing its sector-specific 2030 interim financed emissions targets and withdrawing its 2050 net zero commitment.

The bank mentioned several outside factors. These include changes in public policies, shifts in consumer behavior, and new technology. These reasons led to its strategic shift.

The bank stated:

“When we set our financed emissions goal and targets, we said that achieving them was dependent on many factors outside our control…Many of the conditions necessary to facilitate our clients’ transitions have not occurred.”

This change happens as the political backlash against net-zero policies in the U.S. grows. This trend follows President Donald Trump’s re-election. The administration is rolling back climate rules, which gives banks less reason to stick to strict decarbonization goals.

Wells Fargo’s choice reflects a wider trend in banking. For example, HSBC is also easing rules on fossil fuel financing.

• SEE MORE: HSBC Scales Back Net Zero Plans by 20 Years: A Climate Setback or Realistic Strategy?

Wells Fargo’s Emissions Reduction Strategy

Before Wells Fargo stepped back from net-zero promises, it was working hard to cut its operational emissions. The bank aims to cut its greenhouse gas (GHG) emissions by 50% by 2030. This target is based on its 2019 levels.

The bank is working to reduce its Scope 1 and 2 emissions, which totaled 641,026 metric tons (location-based emissions) in 2023. These emissions include direct emissions from its own operations and indirect emissions from the electricity it buys.

Key components of Wells Fargo’s emissions reduction strategy include:

• 100% Renewable Energy Usage: Wells Fargo has been operating on 100% renewable energy since 2017 to power its global operations.
• Energy Efficiency Measures: The bank invested in high-efficiency HVAC systems, LED lights, and smart energy management systems. These upgrades are in branches and offices to cut energy use.
• Sustainable Building Initiatives: The company is investing more in LEED-certified buildings. They want all new corporate offices to meet high environmental standards.

Wells Fargo uses carbon credits to offset its emissions. The bank offsets its residual Scope 1 and Scope 2 emissions through the purchase of voluntary carbon credits registered under the Verra Registry’s Verified Carbon Standard (VCS) Program and the Climate Action Reserve Registry (CAR). These credits are used to compensate for emissions that remain after reduction efforts.

In 2023, Wells Fargo retired about 86,044 metric tons of carbon credits to offset its residual Scope 1 and 2 emissions.

Wells Fargo not only aims for operational sustainability but also works to cut financed emissions. These emissions come from the businesses and industries it lends to. While it has now scrapped its sector-specific financed emissions goals, the bank had targeted emission reductions in high-impact industries, such as oil and gas, power generation, and automotive manufacturing.

A Changing Approach to Sustainability Financing 

Wells Fargo says it still cares about sustainability financing, even after rolling back its net-zero commitments. The bank promises to keep funding both traditional and low-carbon energy options. It will continue to support clients’ efforts related to climate change.

As of December 2023, Wells Fargo has about $55 billion in commitments. This amount goes to oil, gas, pipeline companies, and utilities. The bank has given more than $20 billion in renewable tax equity since 2006.

Also, it has invested $178 billion in sustainable finance in the last three years. These investments include $16 billion in renewable energy projects and over $15 billion in clean transportation finance.

In 2021, Wells Fargo set a goal to provide $500 billion in sustainable financing by 2030. The bank confirmed that it will maintain this target despite scrapping its net-zero goals. It will also keep working on its goals to reduce Scope 1 and 2 emissions for better operational sustainability.

Impact on the Financial Sector

Wells Fargo’s move raises questions about the financial sector’s role in addressing climate change. Many banks promised to follow the Paris Agreement’s climate goals. However, making these goals happen has been tough.

High energy prices, economic worries, and investor demands for profit have changed priorities.

The bank’s withdrawal from the Net-Zero Banking Alliance (NZBA), a global coalition committed to financing emissions reductions, further signals a shift in strategy. Other big U.S. banks, like Goldman Sachs, have left the alliance. This shows a wider trend in the industry of stepping back from strict climate commitments.

• RELATED: Morgan Stanley, Citi and Bank of America Exit Net-Zero Alliance: What’s Next for Sustainable Finance?

Criticism from Climate Advocates

Wells Fargo’s choice has faced harsh backlash from climate activists and sustainability supporters. The Sierra Club has criticized the bank for breaking its climate promises. They say financial institutions are key to funding the shift to a low-carbon economy.

Greenpeace UK and other environmental groups agree. They say that financial institutions play a major role in shaping global climate efforts. When banks invest in fossil fuels instead of renewable energy, they hurt the climate crisis rather than help it.

Investor Reactions: Profit Pressures Take Priority

Wells Fargo’s strategic shift aims to keep investors confident and ensure profits. The bank’s leaders stress that they focus on meeting client needs. They also aim to ensure financial stability in a fast-changing economy.

Wells Fargo feels pressure from activist investors. One major player is Elliott Investment Management. They want the bank to deliver better returns. The bank’s share price has lagged behind rivals like JPMorgan Chase and Goldman Sachs. So, leaders are now shifting their focus back to core banking functions instead of ambitious climate goals.

The bank’s revised strategy includes:

• Reducing operational costs and divesting $20 billion in assets by 2027.
• Increasing fossil fuel financing, maintaining significant lending to oil and gas projects.
• Shifting its renewable investments to a more selective and capital-light model.

What’s Next? Will Other Banks Follow Suit?

Although Wells Fargo has abandoned its financed emissions reduction targets, it continues to position itself as a key player in sustainable finance. The bank says it will still help clients with decarbonization strategies. It will keep investing in renewable energy where there are good opportunities.

However, the broader implications of this decision remain uncertain. The move might encourage other banks to rethink their net-zero pledges. This is especially true in areas where political pushback against climate policies is rising. But pressure from institutional investors and global stakeholders may lead to new commitments later.

As the global energy transition unfolds, Wells Fargo’s evolving strategy reflects the complexities financial institutions face in balancing profitability, regulatory landscapes, and climate goals. The bank still supports sustainable finance, but its move away from net zero shows that aligning finances with climate goals is a tall order.

• READ MORE: Visa vs. Mastercard: Who’s Leading the Charge in Finance, Sustainability, and Net Zero?

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Verra recently introduced the Verified Carbon Standard (VCS) Methodology VM0051 to reduce greenhouse gas emissions from rice farming. Under this guideline, farmers will practice improved water and crop management practices in flooded rice systems.

Verra began developing this methodology in late 2023. They held a public consultation in 2024 with ATOA Carbon and external reviewers to refine VM0051. The new standard, “Improved Management in Rice Production Systems, v1.0, replaces the old Clean Development Mechanism (CDM) method AMS-III.AU. The previous method ended in March 2023.

Verra’s VM0051: A New Approach to Reducing Rice Emissions

Rice is a staple for over half the world’s population. Rice fields cover around 168 million hectares. But they also release a lot of methane, which is a potent environmental pollutant.

As mentioned before, VM0051 promotes sustainable farming techniques. These methods reduce methane emissions from rice farming and improve water and fertilizer use. The standard also provides social benefits by raising farmers’ income and helping women get training and financial services in agriculture.

Generate High-Quality Credits 

Verra’s VM0051 also aims to measure or quantify emission reductions more accurately. This method promotes actions such as enhancing rice varieties and using methanotrophic bacteria to cut down methane. By using VM0051, project developers can earn high-quality Verified Carbon Units (VCUs).

Subsequently, buyers or stakeholders will want these credits to help improve rice farming, boost food security, and meet their climate goals.

• RELATED: Verra Holds Crediting for CDM Rice Cultivation Methodology

Key Features 

Some major improvements over the previous CDM methodology include:

• Stronger Additionality Criteria: The methodology introduces stricter guidelines for proving additionality, including the use of remote sensing data.
• Expanded Project Eligibility: Eligible activities now include using methanotrophic bacteria, shortening cultivation periods, avoiding residue burning, planting low-emission rice varieties, and optimizing nitrogen fertilizer use.
• Soil Protection Measures: Safeguards prevent soil organic carbon (SOC) loss due to new farming methods.
• Comprehensive Emission Tracking: Monitor and quantify nitrous oxide (N2O) emissions, along with CO2 from fossil fuels and energy use.
• Dynamic Baseline Setting: The methodology adjusts baseline emissions based on actual weather conditions.
• Improved Guidance: It provides clear instructions for project area classification and emission reduction calculations.
• Flexible Measurement Methods: Project developers can choose from different quantification approaches, including biogeochemical models.
• Digital Monitoring and Verification: Promotes advanced tools like remote sensing, artificial intelligence, and machine learning to streamline project validation and verification.

Quantifying Emission Reductions

VM0051 provides three methods for measuring emissions:

1. Biogeochemical Process-Based Models: These simulate how farming practices impact emissions.

2. Direct Measurement: Field studies gather data on actual methane emissions.

3. Default Equations and Emission Factors: Use standard emission factors for easy calculations. These are available for projects that emit less than 60,000 t CO2e per year.

How VCS Projects Can Transition

Each project selects a method based on its size and emission sources. Table 4 in the methodology document lists all eligible quantification options.

Future Developments

Verra is creating a digital version of VM0051. You can find it on the Verra Project Hub. This tool will streamline project submissions with structured templates for data collection. Verra is also looking to integrate VM0051 into its upcoming Scope 3 Standard Program.

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As demand for nickel rises, the Philippines can strengthen its role in the EV supply chain. However, a proposed ban on raw mineral exports could reshape its industry. At the same time, global trade tensions are adding uncertainty. New US tariffs on nickel imports, combined with an ongoing supply surplus, are keeping prices volatile.

While some experts predict that the long-term nickel price might increase as demand outpaces supply, near-term challenges remain. Can the Philippines capitalize on this shift, or will market instability hinder progress?

Nickel and Copper Demand Soars – Can the Philippines Capitalize?

The Philippines is the world’s second-largest producer of mined nickel. Copper and nickel both are essential for lithium-ion batteries used in electric vehicles (EVs). With the demand for these metals rising, the Philippines has a unique opportunity to become a key supplier in the EV supply chain.

But on February 3, Senate President Francis Chiz G. Escudero approved the measure to ban the export of raw minerals. 

He said,

“What we are looking at is to shift our policy from merely exporting raw minerals that will be utilized by other countries to produce higher value products, to developing our processing capabilities. This will result in added value for our minerals-related exports, provide a much-needed boost to our economy and generate employment for our people.”

Boosting Domestic Nickel Refining

If enacted, the ban will take effect in five years, giving mining companies time to establish processing plants. This policy shift is especially significant for key energy metals like nickel, which play a crucial role in the global battery and renewable energy sectors.

Escudero highlighted Indonesia’s 2020 ban on nickel ore exports as a successful example. He hopes that by processing nickel and copper within the country, the Philippines can become a major supplier of battery materials and a key player in the global EV industry.

He also believes that building a strong refining industry will create jobs, reduce dependence on raw material exports, and boost the economy. In the future, this could even help the Philippines manufacture its electric vehicles.

Challenges in Implementation

Mining groups are against a proposed export ban on ore, saying it will hurt the country’s mineral sector.

The Chamber of Mines of the Philippines (COMP) and the Philippine Nickel Industry Association (PNIA) support Senate Bill (SB) 2826 but disagree with the ban. The bill introduces a new tax system based on profits, but the groups believe stopping ore exports will cause problems.

They argue that mining companies cannot build processing plants within five years because of high power costs, poor transport systems, and conflicting local rules. The Philippines also has some of the highest electricity prices in Asia, making local processing too expensive.

They said, “Unless these issues are fixed, processing minerals locally will remain just a dream. There are no shortcuts.”

Supply Surplus and Investment Risks

Even though the Philippines wants to boost its nickel industry, the global market already has too much supply. Big companies have secured their nickel resources, and experts at the Shanghai Metals Market (SMM) predict this surplus will grow even more in 2025 and beyond.

As this decision takes shape, the Philippines may face challenges in developing a strong local processing industry. With too much nickel already available, demand may not be high enough to make processing profitable. This could make it hard to attract big investors, slowing down the country’s plans to move from raw ore exports to processed nickel products.

Impact on China’s Nickel Supply

According to SMM, the Philippines exported 54 million metric tons of nickel ore in 2024. Out of this, 43.5 million mt went to China, while 10.35 million mt was sent to Indonesia.

If the Philippines decides to ban ore exports, China could face serious supply disruptions. The country relies heavily on Philippine nickel, especially after Indonesia tightened its mining quotas in 2024. A ban would likely create shortages, pushing China to look for other suppliers or invest in processing facilities within the Philippines to secure its supply.

A Short-Lived Rally for Nickel Prices

So, what happened to nickel prices after the Philippine government’s announcement of considering banning nickel ore exports? Well, as reported by S&P Global, this news sparked optimism in the nickel market, helping prices climb back to $15,811 per ton on February 6. 

However, further gains were limited. Between February 7 and February 21, prices remained within the $15,400 to $15,800 range, and fears of worsening trade tensions loomed large.

• READ MORE: Philippines Aims for Nickel Dominance with New Mining Reforms

The Larger Picture: How the U.S Tariff War is Shaping Nickel Prices?

S&P Global has provided deeper insights into how U.S. tariffs could affect nickel prices and the broader American nickel market. In January, the White House announced new tariffs on imports from Canada, Mexico, and China. Following this, nickel prices tumbled to a one-month low of $15,210 per ton.

In early February, President Trump signed executive orders imposing a 10% tariff on imports from China and an even higher 25% tariff on goods from Canada and Mexico. These tariffs took effect on February 4, keeping nickel prices on the London Metal Exchange (LME) below $16,000 per ton throughout the month. As trade tensions escalated, market uncertainty overshadowed concerns about a possible nickel ore export ban in the Philippines.

Canada quickly responded. Trudeau announced a 25% tariff on $155 billion worth of US goods, set to take effect the same day. But just before the deadline, the US government delayed tariffs on Canada and Mexico by 30 days, temporarily easing market concerns.

Will it Backfire on the US EV Industry?

If the US moves forward with a 10% tariff on nickel imports from Canada after the 30-day delay, it could drive up costs for American industries. Canada supplied nearly one-third of the US’s primary nickel imports in 2024, making it the country’s largest source.

The bigger challenge? The US produces very little nickel. The only nickel-producing mine is Lundin Mining’s Eagle Mine in Michigan. It contributed just 0.21% of global output in 2024 and is set to close before the decade ends. On top of that, the US lacks refining capacity for class 1 nickel, a key material for EV batteries.

If tariffs on Canadian nickel remain in place, it could become harder for US manufacturers to access affordable supplies, especially for the EV and stainless-steel industries. The US had expected to depend on Canada to meet its rising demand for battery-grade nickel.

However, trade restrictions might create challenges for this plan. It can also affect the competitiveness of domestic EV companies in the global market.

The Bottom Line

At present, the global nickel market remains volatile, affected by trade tensions, excessive supply, and evolving policies. All these factors are driving prices down. However, this dim nickel environment is expected to shift in the future.

With a declining market balance and reduced oversupply, nickel prices are forecasted to rise. By 2030 and beyond, demand is projected to exceed supply, leading to a further price increase.

• RELATED: Nickel Prices Plunge in 2025: Can Demand Revive the Market by 2030?

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