Survey: Mines in Latin America most likely to increase spending
Timetric’s Mining Intelligence Center (MIC) surveyed 630 mine managers to outline their planned changes in expenditure on site for the next 12 months, compared to the prior year, with respondents asked to choose from ‘significant increase’, ‘slight increase’, ‘stay the same’, ‘slight reduction’ or ‘significant reduction’.
The survey found that 16 percent of respondents in Latin American cited ‘significant increase’ in their spending for the coming year, with only 10 percent in Africa, nine percent in Asia, four percent in Europe and Australia, and three percent in North America.
Results from the survey were analyzed with the number of operating mines in each region undergoing expansion. MIC found that Latin America had the second-highest share of operating mines currently in expansion with 15 percent, compared with Africa (13 percent), Asia (seven percent) and North America (two percent).
“Latin America has a higher share of mines planning substantial increases in their spending within the next 12 months than any other region, and with the final decisions regarding equipment purchases being mainly decided at the mine site level, OEMs and their resellers need to ensure they are close to the customer to benefit from these additional investments,” said Nez Guevara, Senior Mining Analyst at Timetric’s MIC.
The survey is based on Timetric’s report -- Purchasing Trends and Intentions for Mining Equipment, Parts and Consumables in Latin America, 2015. Over 51 percent of survey respondents were decision-makers currently working operating mines.
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Earlier this month, Timetric released its ‘Winning and Retaining Business in the Mining Equipment Sector in Latin America 2015’ report, which surveyed 100 key decision-makers at mines throughout Chile, Peru and Brazil, and found the majority of respondents were unhappy with their OEMs.
“Timetric’s research demonstrates the current mindset of mining companies in Latin America and the importance placed on minimizing costs throughout the business,” said Guevara.
“This includes costs associated with the maintenance and servicing of heavy mining equipment. Mining companies have outlined their dissatisfaction with these costs and have indicated plans to switch OEMs within the next five years.”
Zimbabwe targets £8.8bn mining industry by 2023
Zimbabwe’s government plans to fast-track exploration, evaluation and digitalisation of selected reserved mining areas under the Ministry of Mines and Mining Development as part of wider measures to achieve a £8.8 billion mining industry by 2023, according to a senior government minister.
Information Minister Monica Mutsvangwa said other plans include stopping the issuance of special grants in the reserved areas under the Ministry of Mines and Mining Development until the exploration and evaluation is complete and a robust value addition program for diamonds is implemented.
Mutsvangwa was speaking at a post-cabinet media briefing on December 15.
She adds that the issuance and renewal of special grants for energy should also be based on the financial and technical capacity to value add all types of coal, as well as for ideal exploration of Coal Bed Methane.
For renewal of special grants, consideration should take into account the period the Special Grant has been held as well as plans with milestones for value addition of the special grant, Mutsvangwa says. She adds that the Zimbabwean government expects gold to drive the mining sector in order to achieve the ambitious target, with the precious metal expected to contribute approximately £2.96 billion to the overall target.
Mining is one of Zimbabwe’s major contributors to its economy, alongside agriculture, which is the mainstay. The mining sector accounted for more than 60 percent of the country’s foreign currency receipts in 2019, and contributed around 16 percent to national Gross Domestic Product, the Chamber of Mines says.
The country’s mining industry is focused on a diverse range of small to medium mining operations. The most important minerals produced in Zimbabwe include gold, asbestos, chromite, coal and base metals.
Zimbabwe expects its economy to expand by 7.4 percent in 2021 from a projected contraction of 4.5 percent this year, due to the effects of drought and the COVID-19 global pandemic.
When presenting the 2021 National Budget in November this year, Finance and Economic Development Minister, Professor Mthuli Ncube, said that the mining sector is projected to rebound by 11 percent next year after surviving a COVID-19 induced shock that saw the sector contract by 4.7 percent in 2020. In September, mining bans in national parks were introduced, according to news agencies.
He added that the National Budget would allocate £1 billion towards the operations of the ministry for planning, promotion and exploration, data capturing, and automation, among other key mining processes.
Other factors necessary for the achievement of the £8.8 billion target include a stable macroeconomic environment, policy consistency, and availability of long-term capital to fund mining projects along the entire mineral value chain, the minister said.
Stopping "illicit financial flows" from gold smuggling is another key issue to address, according to media reports.