Released August 16, 2021 | SUGAR LAND
en
Researched by Industrial Info Resources (Sugar Land, Texas)--Industrial Info's recent webinar on the global Mining Industry discussed the trends and drivers affecting different geographies and mined commodities across the world. One of today's drivers influencing spending is the energy transition and shift toward more carbon-neutral practices. This not only is affecting the types of metals and minerals being mined, but also is changing the way mining companies operate. In the webinar, Joe Govreau, Industrial Info's vice president of research for the Metals & Minerals Industry, talked about this other and trends.
The energy transition is driving project activity across all industries, increasing the need for different metals and minerals. For example, electric vehicles require large amounts of aluminum, copper, lithium and lanthanum. Wind and solar generation require steel, aluminum, copper, cadmium and rare earth elements.
"The energy transition will bring changes not only to the mining industry, but to the entire industrial complex, which will not only have to increase capacity but also have to be retooled to be less carbon-intensive," said Govreau, who noted that a major mining equipment supplier forecast that it would be selling more electric than diesel vehicles within 10 years.
Govreau also reviewed some of the broader trends seen in the sector, saying he thought that a mining "super-cycle" had begun, although this is not expected to reach the spending peaks seen 2012. "Mining firms are being much more conservative in their capex plans compared to the last up-cycle, so I think it will be a much more long-term, staggered increase over the next decade or two," he said. Except for a blip caused by the onset of the COVID-19 pandemic in 2020, spending in the mining sector has increased every year since 2017, and Govreau expects this trend to continue.
Click on the image at right for a breakdown by world region of active mining projects being tracked by Industrial Info.
After diving deeper into what is happening in global regions such as the U.S. and Canada, Latin America and Oceania, Govreau discussed the trends in specific commodities.
Coal
While coal-fired power is on its way out in developed regions such as North America and Europe, it is still going strong in other parts of the world such as Asia, where Industrial Info is tracking more than 300 grassroot coal-fired power plant projects. Discussing coal, Govreau said, "It's a large market and, with the improved economy and increased electricity demand, thermal coal usage is increasing, at least in the near term and probably through 2022," adding that coal mining remains an important source of project activity, even with the move to decarbonize underway. Coal accounts for 57% of China's power production. Demand for metallurgical coal, used primarily for steel production, also is on the rise.
Iron Ore
Iron ore demand from steel manufacturers across the world is increasingly robust. Companies like Vale SA (NYSE:VALE) (Rio de Janeiro, Brazil) and Rio Tinto (NYSE:RIO) (London, England) are increasing production, and China has said it will build two iron ore mines in Africa by 2025.
Copper
Demand for copper is a bellwether of economic growth, and this metal was already seeing some tightening of supply before the COVID-19 pandemic began. "As one of the key metals needed for new decarbonization technologies as well as the infrastructure required to supply electricity, copper demand will show growth for the foreseeable future," Govreau said. Peru and Chile are the largest players in the copper sector. Industrial Info is tracking more than $65 billion of copper projects planned for this year and next.
Gold & Silver
Gold prices are up 70% from the bottoming out of the market in 2016, and gold project development has been brisk, with Africa leading the way.
Lithium
Lithium is key for use in devices such as tablets and mobile phones, and is an important component in the growing electric vehicle sector. "We're seeing increased activity from exploration projects through to feasibility and onward for lithium," said Govreau. While supply outpaced demand in 2018 and 2019, driving down prices, this has changed recently, and higher prices are driving an increase in lithium project activity. Govreau said, "In what just a few years ago was a sector controlled by a handful of producers, is now a battleground for development as companies scramble to meet expected growth." One the world's largest lithium producers, SQM (NYSE:SQM) (Santiago, Chile), has plans to double its lithium production capacity.
If you missed this webinar or would like to revisit some its key points, you can click here to access the presentation.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
The energy transition is driving project activity across all industries, increasing the need for different metals and minerals. For example, electric vehicles require large amounts of aluminum, copper, lithium and lanthanum. Wind and solar generation require steel, aluminum, copper, cadmium and rare earth elements.
"The energy transition will bring changes not only to the mining industry, but to the entire industrial complex, which will not only have to increase capacity but also have to be retooled to be less carbon-intensive," said Govreau, who noted that a major mining equipment supplier forecast that it would be selling more electric than diesel vehicles within 10 years.
Govreau also reviewed some of the broader trends seen in the sector, saying he thought that a mining "super-cycle" had begun, although this is not expected to reach the spending peaks seen 2012. "Mining firms are being much more conservative in their capex plans compared to the last up-cycle, so I think it will be a much more long-term, staggered increase over the next decade or two," he said. Except for a blip caused by the onset of the COVID-19 pandemic in 2020, spending in the mining sector has increased every year since 2017, and Govreau expects this trend to continue.
Click on the image at right for a breakdown by world region of active mining projects being tracked by Industrial Info.After diving deeper into what is happening in global regions such as the U.S. and Canada, Latin America and Oceania, Govreau discussed the trends in specific commodities.
Coal
While coal-fired power is on its way out in developed regions such as North America and Europe, it is still going strong in other parts of the world such as Asia, where Industrial Info is tracking more than 300 grassroot coal-fired power plant projects. Discussing coal, Govreau said, "It's a large market and, with the improved economy and increased electricity demand, thermal coal usage is increasing, at least in the near term and probably through 2022," adding that coal mining remains an important source of project activity, even with the move to decarbonize underway. Coal accounts for 57% of China's power production. Demand for metallurgical coal, used primarily for steel production, also is on the rise.
Iron Ore
Iron ore demand from steel manufacturers across the world is increasingly robust. Companies like Vale SA (NYSE:VALE) (Rio de Janeiro, Brazil) and Rio Tinto (NYSE:RIO) (London, England) are increasing production, and China has said it will build two iron ore mines in Africa by 2025.
Copper
Demand for copper is a bellwether of economic growth, and this metal was already seeing some tightening of supply before the COVID-19 pandemic began. "As one of the key metals needed for new decarbonization technologies as well as the infrastructure required to supply electricity, copper demand will show growth for the foreseeable future," Govreau said. Peru and Chile are the largest players in the copper sector. Industrial Info is tracking more than $65 billion of copper projects planned for this year and next.
Gold & Silver
Gold prices are up 70% from the bottoming out of the market in 2016, and gold project development has been brisk, with Africa leading the way.
Lithium
Lithium is key for use in devices such as tablets and mobile phones, and is an important component in the growing electric vehicle sector. "We're seeing increased activity from exploration projects through to feasibility and onward for lithium," said Govreau. While supply outpaced demand in 2018 and 2019, driving down prices, this has changed recently, and higher prices are driving an increase in lithium project activity. Govreau said, "In what just a few years ago was a sector controlled by a handful of producers, is now a battleground for development as companies scramble to meet expected growth." One the world's largest lithium producers, SQM (NYSE:SQM) (Santiago, Chile), has plans to double its lithium production capacity.
If you missed this webinar or would like to revisit some its key points, you can click here to access the presentation.
Industrial Info Resources (IIR), with global headquarters in Sugar Land, Texas, six offices in North America and 12 international offices, is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. Industrial Info's quality-assurance philosophy, the Living Forward Reporting Principle, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities. Follow IIR on: Facebook - Twitter - LinkedIn.
