HEADLINES
Trump Looks to Sideline Canadian Potash With Belarusian Supply Deal
President Trump is signaling a potential agreement to purchase lower-priced potash from Belarus, a move that could challenge Canadian exporters.
In a Monday post on Truth Social, Trump said he is working on a "massive deal" aimed at lowering fertilizer costs for American farmers and ranchers.
The proposal targets a market currently dominated by Canada, the world's largest producer of potash, a vital fertilizer component and an essential plant nutrient with no substitute in global food production.
Nutrien Stock Falls
AtkinsRealis Venture Secures C$1.7 Billion Nuclear-Station Refurbishment Contract
AtkinsRealis and partner Aecon landed a three-year, C$1.7 billion deal for the refurbishment of a unit at the Pickering nuclear power station in Ontario.
AtkinsRealis's Candu Energy business in a joint venture with Aecon signed the contract with Ontario Power Generation to begin Unit 5 work associated with the Pickering Nuclear Generating Station's retube, feeder and boiler replacement project.
The contract represents the first retube, feeder and boiler replacement unit in a broader refurbishment project, with similar work expected on Units 6, 7 and 8 in subsequent phases.
Artemis Gold Strikes $427 Million All-Stock Deal for Vista Gold
Artemis Gold has agreed to acquire Vista Gold in an in an all-stock deal valued at around $427 million, giving Artemis ownership of the massive Mt Todd gold project in Australia.
Under the terms of the agreement, Vista Gold shareholders will receive 0.0966 shares of Artemis Gold for each Vista share, implying a value of $2.83 a share and a 29% premium over Artemis' 20-day volume-weighted average price, the companies said Monday.
For Artemis, the all-equity transaction introduces no debt and requires no cash outlay, allowing the company to keep its primary capital focus on delivering its flagship Blackwater mine expansions in British Columbia.
Artemis Gold's Vista Acquisition Provides 1 Million Ounce Output Pathway
Capstone Copper to Sell Cozamin Mine to Luca Mining for Up to $385 Million
Capstone Copper has agreed to sell its copper-silver-zinc-lead mine in Mexico to Luca Mining for up to $385 million, as the company drives to streamline its asset base and deploy capital into higher-margin copper growth projects.
In return for the Cozamin mine in Zacatecas, Capstone will receive $275 million in upfront cash, $15 million in Luca shares and $35 million in deferred consideration. Capstone will also receive up to $60 million in contingent earn-outs tied to future copper prices.
Capstone said it plans to use the cash to strengthen the company's balance sheet and offer added flexibility as it moves closer to becoming a focused tier-one growth producer.
CAE Gets $300 Million Contract to Continue U.S. Air Force C-130 Hercules Aircrew Training
CAE will continue to offer C-130 Hercules aircrew training for the U.S. Air Force as part of a $300 million contract.
CAE shares jumped 5.1% to C$34.43.
The pact extends CAE's role as prime contractor for the U.S. Air Force's C-130 Hercules aircrew training system through the end of 2035, marking nearly two decades of partnership with the USAF, said CAE.
As part of the contract, the Canadian company will provide comprehensive training services including program management, instruction, maintenance and logistics support, cybersecurity solutions and ongoing upgrades. CAE prepares trained and qualified C-130H pilots, flight engineers, navigators and loadmasters.
DRI Healthcare to Buy Tavapadon Royalty for $316 Million
DRI Healthcare Trust reached a $316 million deal to buy certain royalty participation rights in U.S. net sales of tavapadon, an investigational Parkinson's disease drug candidate.
The Toronto-based pharmaceutical royalty company said it entered into purchase agreements to acquire the royalty participation rights from funds managed by Bain Capital and NovaQuest Capital Management, subject to approval of tavapadon by the U.S. Food and Drug Administration.
Shares of DRI Healthcare rose 2.7% to C$17.72.
Osisko Critical Minerals Upsizes Private Placement to C$250 Million on Strong Investor Demand
Osisko Metals' subsidiary has just upsized its private placement of special warrants by C$150 million following heavy investor demand.
The company on Monday said that Osisko Critical Minerals, a newly formed spin-out subsidiary, has more than doubled its best efforts private placement of special warrants to C$250 million. Chief Executive John Burzynski said the decision followed overwhelming demand from investors.
Last week, the company announced a C$100 million private placement, looking raise funds to advance its drill and exploration program in New Brunswick.
TALKING POINT
Bank of Canada Grapples With Rate Policy Amid Competing Forces, Macklem Says
By Paul Vieira
OTTAWA--A new quarterly forecast for inflation set for release next month will tip the balance on whether the Bank of Canada needs to raise rates to contain price increases, Gov. Tiff Macklem said.
In remarks on Monday in a speech and a press conference, he said upside inflation risks have intensified with the war in the Middle East showing no signs of ending. Crude oil has traded near $100 a barrel in the past week, and inflation in Canada is set to edge upward from its current 3% level should fuel costs remain in elevated territory, Macklem said.
The next Bank of Canada decision is set for Oct. 28, at which time it will also present an updated growth and inflation forecast to Canadian.
"The key question we're going to be asking ourselves is, 'Is the current interest rate the right one to bring inflation back to the 2% target over time, or do we need to raise the interest rate to guide inflation back to our 2% target?'" he said at the press conference.
Canada's central bank sets interest rates with an eye toward achieving and maintaining 2% inflation, or the midpoint of a 1% to 3% range. Total, or headline, inflation in Canada has been at or above 3% in three of the last four months, although readings that strip out volatile items like food and energy indicate price increases are closer to 2%.
Macklem's speech in Halifax, Nova Scotia, spelled out how the central bank is grappling with higher energy prices stemming from the Middle East conflict and the return of heightened trade uncertainty.
Central bank officials are prepared to adjust policy depending on these two dominant risks evolve, Macklem said, adding policymakers will closely monitor how firms and households respond.
"We don't want to raise our policy rate and restrain growth if inflationary pressures are contained. But nor do we want to be too slow to respond if inflationary pressures are becoming more persistent," Macklem said.
Generally, the central bank estimates that a 10% rise in crude-oil prices would add about 0.20 percentage points to headline inflation. Macklem said this time around, the damage to refining capacity has sparked a faster increase in fuel costs relative to benchmark oil prices. he added that current gasoline prices in Canada are more consistent with a barrel of crude trading at $140, instead of $100.
Royce Mendes, head of macro strategy at Desjardins Group, said the central bank appears to be setting the stage for an October rate increase should energy prices fail to retreat from current levels, "but that's far from a foregone conclusion."
Countering the risk of upside inflation is the the escalation in the U.S.-Canada trade conflict. The imposition of new hefty tariffs by both countries is likely to weigh once again on investment and hiring decisions. "If growth weakens once again for several quarters, economic slack will persist, making it harder for businesses to raise prices," he said.
Macklem added that fourth-quarter growth could slow sharply to below 1% annualized should U.S and Canadian tariffs remain in place. In July, the central bank projected third quarter growth of 1.5% -- after strong second-growth expansion of 3.3% that blew past initial Bank of Canada's expectations.
The yield on the two-year Canadian government bond has recently traded more than one percentage point higher than the Bank of Canada's policy rate of 2.25%, which indicates that fixed-income traders expect rate increases in the near future. The Bank of Canada kept its policy rate unchanged this month at 2.25%, although Macklem at a press conference adopted a more alarmed tone regarding inflation as the U.S.-Iran war shows no signs of ending. That conflict, which started in late February, has effectively shut down oil shipping through the Strait of Hormuz and damaged refinery capacity.
"We are going to make our best judgment and decide what we think is the best thing to do to bring inflation back to target," said Macklem, when asked about traders' expectations.
A good portion of Macklem's speech documented how Canadian businesses have adapted to the changing trade environment, as well as the adoption of artificial intelligence and aging demographics.
Second-quarter data showed a strong 14.5% climb in nonenergy exports, reflecting what Macklem said were business decisions to reduce their tariff exposure and adjust their supply chains. "Canadian businesses are building resilience by broadening their options," the governor said, adding that puts the economy on stronger footing amid a fresh bout of cross-border trade uncertainty.
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