A Cross-Province Pact Powers Battery Localization

Two Canadian firms link refining and precursors, strengthening local battery supply and cutting reliance on overseas processing

26 Nov 2025

A co-operation agreement between Electra Battery Materials and Positive Materials is set to strengthen Canada’s position in the North American battery supply chain, as governments and manufacturers seek to reduce reliance on overseas processing.

The Supply Chain Cooperation Agreement, signed on November 25, 2025, focuses on the midstream segment of the industry, where raw materials are refined and converted into battery-ready inputs. This stage has been heavily concentrated in Asia, leaving automakers and cell producers exposed to shipping disruptions, price swings and geopolitical tension.

Electra is developing a facility in Ontario to produce cobalt sulfate, a key ingredient in lithium-ion batteries. Positive Materials, through its Project Positive + initiative, is planning a precursor cathode active material plant in Belledune, New Brunswick. While each project addresses a separate step in the production process, the companies say closer alignment will create a more integrated domestic pathway from refined metal to precursor material.

The move reflects a broader shift across the sector. Rather than advancing stand-alone projects, companies are increasingly coordinating across the value chain to secure feedstock, manage costs and shorten development timelines. Aligning production plans at an early stage can also reduce execution risk and improve visibility for potential customers and investors.

Policy support has reinforced this trend. Federal and provincial critical minerals strategies in Canada, alongside clean energy incentives in North America, favour battery materials that are processed locally and sourced transparently. Automakers and battery manufacturers face growing regulatory and investor pressure to demonstrate traceable and responsibly produced inputs.

Significant challenges remain. New refining and precursor facilities require substantial capital, and advances in battery chemistry could alter demand for certain materials over time. However, industry analysts view the agreement as part of a wider effort to build resilience into regional supply chains.

As North America expands electric vehicle production, integrated domestic partnerships are likely to play a larger role in securing raw materials and meeting policy requirements tied to local content.