IMPORTANCE OF MINING INDUSTRY TO CANADA
AN ADDRESS BY ARTHUR A. COLE, M.A., B.Sc.
Before the Empire Club of Canada, Toronto December 7, 1916
MR. PRESIDENT AND GENTLEMEN,--Canada is a country of large railway developments, when we consider it on a per capita basis. Most Canadians, if asked why we have so much railway development, will answer that it was primarily with the object of opening up our vast agricultural areas, and likely they would be right.
Now I do not wish for a moment to minimize the importance of the agricultural industry. It is our most important basic industry, but we should try to see things in their true perspective. Now that we have the railways, who supplies the business to them?
Let us take, for example, our own little railway, the Temiskaming and Northern Ontario Railway--I speak of it as "our railway," as it is the people's railway, and "we are the people." The T. & N. O. Railway was projected as a colonization railroad to open up the large agricultural areas to the north of Lake Temiskaming, known as the "clay belt" of Northern Ontario. Now let us see who provides the freight for this railway.
During the last five years the mining industry has been accountable for 47 per cent. of the total freight revenue, while agriculture gave nearly 13 per cent. or a little over quarter that of the mining industry. Thus the railway was built for the farmer, but the miner supplies the freight. If the railway was forced to depend solely on the farmer for its freight revenue, it is likely that we would have to be content with one or two mixed trains each way weekly instead of as at present, from two to three up-to-date passenger trains daily.
Perhaps you may think this an exceptional case, so let us consider figures covering the whole of Canada. In the report for the fiscal year 1913, the Department of Railways and Canals publishes figures from which we may gather the following :--For the year 1913 the products of agriculture handled by the Canadian railways formed 16 percent of the total, and during the same period the products of mines was 38 percent of the total, or more than twice as much, and these percentages were practically the same for the six years previously. The manufacturer need not think that he makes a better showing than that, for manufactures come 1 percent less than that of agriculture (114.8 percent).
If you are still unconvinced of the importance of the mining industry let us extend our investigation a little farther afield. If we examine figures prepared by the Interstate Commerce Commission covering freight traffic over the railways of the United States, we find that for two years which were considered normal, products of agriculture were 9 percent of the aggregate, while the products of mines formed 53 percent of the total, or nearly six times as much. These are facts that we cannot get away from, and must show us that from a railway standpoint at least the mineral industry is of immense importance.
THE MINERAL INDUSTRY IN WAR TIME
Now let us consider for a few minutes the part the mineral industry may play in war times. Speaking of the war, Mr. Asquith says:--" It is a struggle of material and economic resources, and these will prove in the long run to be the deciding factors."
Germany for years past has paid particular attention to her mining and metallurgical industries, and this has proved a great source of strength to her.
If you will examine a map of Belgium you will find that the general line of advance of the German Army through Belgium was along the valley of the Meuse. This we find is the line of the principal coal deposits of Belgium which are located in Liege, Huy, Mons and Charleroi and the newly-discovered deposits to the north of Liege, known as the Campine field. The coal output of Belgium the year before the war was 2212 percent million tons.
The principal French coal field, and that one now in the possession of the Germans, is the field of Valenciennes, which is the continuation of the main Belgian field, the whole being known as the Hainault Basin. The coal output of France for the year 1913 was 40 million tons, the bulk of which was probably supplied by the Valenciennes field.
Before 1870 French territory extended east to the Rhine. At the close of the Franco-Prussian war Bismarck laid it down as axiomatic that the valley of the Rhine must be secured to Germany by the possession of both banks, and in order to do this the Provinces of Alsace and Lorraine were taken from the French. In Alsace the natural boundary between two countries was the Vosges Mountains, but when it came to Lorraine there was no such natural boundary. There were, however, valuable iron ore areas, so the boundary was arranged to throw all of the then known iron deposits into German territory. As soon as France began to recover from the results of the war her engineers started boring on the French side of the line. A simple explanation of the structural geology of this area is that the different formations are slightly tilted from the horizontal, and dip gently towards the valley of Paris. Thus, in travelling from Lorraine towards Paris, you cross the different geological formations at right angles in gradually ascending scale. The iron-bearing formation outcrops in the German acquired Province of Lorraine, but the deposits continue in gradually increasing depth coming west in French territory. The French engineers soon located the continuation of these iron deposits by means of bore holes, and at once began development, and in the face of considerable difficulties by the year 194 they had developed a larger iron industry than was on the German side of the line, and had greater ore reserves. The French deposits occur in what is known as the Briey Valley, and these form one of the most important iron ore areas in Europe. The production of this area in 1973 was about 30 million tons. This area has been in the possession of the Germans since the beginning of the war, and it has been estimated that last year it supplied 6o percent of the total iron ore production.
The possession by the Germans of this iron field, along with the possession of the Valenciennes coal field, deprived the French at one swoop of the greater part of their iron and coal production. This, of course, was a great blow to the French and a corresponding source of strength to the Germans.
Perhaps the most common question that we have heard in connection with the conduct of the war on the western front is, "Why did the Germans attack Verdun?" And as every non-combatant seems to have an answer ready, and but few of them are at all satisfactory, an explanation that was suggested by a recent statement of Ferand Engerand, a member of the French Chamber, may not be here amiss. The Briey Valley containing the French iron ore deposits lies between Verdun and Metz. Perhaps some of you will remember that early this year a report appeared in the papers stating that the civil population of Metz had been warned to be ready to vacate the city. It would look as if the French forces were threatening the German lines near Metz sufficiently, and that the Germans were preparing Metz for a possible siege. If the Germans had been compelled to retire back of Metz the consolidation of their lines would throw all the iron deposits of this area into the hands of the French. This, of course, was one of the last things they wished to do. On the other hand, if a breach could be made in the French lines at Verdun, which was one of the strongest points in the line, it would mean that the French would have to consolidate their lines at a considerable distance from Verdun, and this would not only relieve Metz, but would remove the iron deposits from the immediate danger zone. Surely this provides one good reason for the attack on Verdun.
Germany's dependence on the Briey iron field is shown by the following communication which, on the 20th of May, 1915, was sent to Chancellor von Bethmann-Hollweg by Germany's six great industrial and agricultural associations, which ran as follows:
"The manufacture of shells demands iron in a quantity so great that no one could have formed an idea that so much could be used, had not our need of it been demonstrated. If we had not been able to double the production of rough iron and steel since the month of August, 1914, it would have been impossible to continue the war.
"We might count the war as very nearly lost should our production of minette (the Lorraine material) be disturbed."
This quotation shows how important French iron is to the Germans. The Belgian coal mines and the iron mines of Briey are the two elements that the Germans most require for their war; loss of these elements, Deputy Engerand declares, would mean the annihilation of German military power. Let us hope and pray for the early accomplishment of this most desirable end. We can now see that there is more than a mere sentimental feeling on the part of Frenchmen in wishing to bring Alsace and Lorraine back under French rule. I just use these examples to show how important the mineral industry may become in war times.
THE MINERAL INDUSTRY OF CANADA
Returning to Canada, let us for a few moments take an inventory of our mineral industry.
Our total mineral production now amounts to 175 million dollars annually, of which our own province produces nearly one-half. In a list of our mineral resources you will find that there are very few of the important ones missing, and in some of those we have we lead the world. Let us consider a few special cases.
Our coal resources are among the greatest in the world.
Our asbestos deposits in the Eastern Townships of the Province of Quebec supply most of the asbestos of commerce.
The greatest nickel deposits in the world are located at Sudbury. Ontario has the largest body of high-grade talc on the continent at Madoc; the largest body of high-grade feldspar on the continent in the Richardson Mine near Verona; the greatest mica mine on the continent at Sydenham, and the greatest graphite mine at Calabogie, and quite recently a molybdenite property has been discovered within twenty-five miles of Ottawa that bids fair to outstrip all rivals.
We also have one of the richest silver camps in the world at Cobalt, and the most promising of the younger gold camps on the continent at Porcupine.
Our smelters at Deloro and Thorold also produce more refined cobalt than all the other refineries in the world put together.
These are just a few of the lines in which we lead, but the remainder of our production is by no means insignificant.
With such a magnificent heritage we would be very delinquent in our duty if we did not give the mineral industry the careful attention that it deserves.
THE ORGANIZATION OF THE INDUSTRY
In the past there has been too little co-operation between the miner and the manufacturer. We did not notice our lack of organization until the war broke out, and then our deficiencies were made, apparent. In March last, at the request of Sir George E. Foster, Minister of Trade and Commerce, a special committee of the Canadian Mining Institute was appointed to study conditions in respect of the mineral and metal industries of the Dominion with a view to determining
(1) To what extent Canada can supply the requirements of the Empire, and thus help to make it self-supporting and independent of outside sources for those supplies of materials essential to its needs, both in times of peace and war; and
(2) To indicate the possibilities as regards the utilization of the natural resources of the Dominion to greater national advantage than heretofore, in the upbuilding of home manufacturing industries.
In other words there is apparently sound reason to believe that we are now exporting a great quantity of raw material which could be much more profitable, so far as the national interests are concerned, if made the basis of manufacturing industries at home; and also importing supplies, a considerable proportion of which we could quite readily and most advantageously produce ourselves. In some cases it will be necessary merely to indicate the opportunities that exist for the establishment of new industries to effect the desired end; but in other instances Government encouragement will be required.
Now how may the public help us in this work? I appeal to you, gentlemen of the Empire Club of Canada, as leaders of thought in this enlightened city of Toronto, to give this subject the intelligent consideration that it deserves. No one can plead that it does not concern him. Mining is one of our basic industries, and it enters more or less into the lives of every one of us. The industry is sure to be benefited if we have a more intelligent understanding of it by the ublic. You do not need to be a stockholder in a mine to be financially interested in its development. Take, for instance, the little camp of Cobalt. Of course a camp, to be successful, must make profits, and Cobalt does and the result is the dividends that are paid. If you are a shareholder, that is what you are most interested in. But let us look at Cobalt from another angle, that of a non-shareholder. It costs seven million dollars annually to run the Cobalt mines, and after careful enquiry I am convinced that most of that seven millions eventually finds its way down to Toronto. If you area merchant or a manufacturer in the city, does not the matter of an extra five or six millions annually coming into the city interest you? and remember that Cobalt is only one of a number of flourishing mining camps up north. But perhaps you are not interested in monetary profit. Perhaps you are like one of your leading daily newspapers. Last week I went into this newspaper office, and after holding out my money for ten minutes wanting to pay for a yearly subscription in advance, I had to come away with my money. A clerk did look up at me when I asked if they were too busy to take some money, but I got no other reply. Now, although I used to think that that paper had a strong political bias, I now consider it the most independent paper in Canada.
Speaking seriously, however, I ask you to familiarize yourselves with the work of the mining industry, and I am sure that you will find the study beneficial, for in the future there is certain to be legislation introduced regarding the mineral industry, that will receive more intelligent treatment if we have a well-informed public to back it up.
It is doubtless lack of information that makes the public so often judge the mining industry from the losses made through gambling in mining stocks. When a man gambles in wheat and loses, he does not blame the agricultural industry lie usually keeps quiet about his losses, but privately he must confess to himself that his losses are due to his own ignorance or inability to properly size up the wheat situation. He should treat the mining industry in the same way.
If a man is heard blaming the mining industry for his losses, he is simply proclaiming to the world that he is a gambler in mining stocks, and on enquiry it will usually be found that although he may be a shrewd, careful and successful business man in his own line, when it comes to mining he throws shrewdness and common sense to the winds and ignores usual business methods. Under the circumstances, the dice are loaded against him and he has not an ordinary gambler's chance.
If a man were offered a bargain in real estate, he would not think of paying over his money before he had made a personal investigation of the property, or had got an' expert opinion on it, or both; yet, when buying a mining property, that same man often puts up his hard-earned savings without anything more than a seller's report.
If you wish to invest in the mining industry, and not simply to gamble, use ordinary business principles and common sense, and I can assure you that I know of no other industry on earth that gives larger returns for the capital invested.
The forecasts for the future may be considered superfluous, but I think in this case that they may help us in a campaign of better preparedness for the future. Again let us turn to our northland for inspiration. Anyone who looked over the unbroken forest of Northern Ontario a dozen years ago and predicted that this district would soon be producing twenty millions in gold and silver annually would have been put down as a fantastic dreamer. But that is a fact today, and the output is continually increasing.
And yet only a small portion of the country has been prospected. Running north-east and northwest from Cobalt and extending to the Arctic Ocean is the great Canadian pre=Cambrian shield, the basement formation of the continent. It contains thousands of square miles and offers to prospectors better chances of locating valuable mineral deposits than can be found in any other country in the world.
Turning from such a past record and looking forward into the future, it requires no very vivid imagination to see other Cobalts and other Porcupines converting the wilderness into thriving hives of industry.
A hearty vote of thanks was passed.