AS a new year dawns the global mining industry is at a very low ebb with volatile mineral commodity prices, very little capital available to support exploration or expansion projects, let alone new projects, and many existing operations struggling to break even at best. This has resulted in jobs being lost at mining operations and major impacts on the mining supply and service sector.
CHINA’S economic growth has slowed, prompting some so-called experts to claim that its economy will collapse. When coupled with the global downturn, this paints a gloomy picture. However, while there are some problems, China’s economy is not about to collapse as the government has deliberately slowed growth to achieve economic transformation and upgrade through a more sustainable growth rate.
ALTHOUGH Australia’s resource-reliant economy is feeling the pain of lower commodity prices, high construction and infrastructure costs, and falling investment, it is not right to say the mining boom is over. Such statements are not conducive to encouraging a turnaround in fortunes and, if anything, create more doom and gloom than warranted.
The Indonesian Government’s proposal to increase coal mining royalties to 13.5% of net sales in 2014 from the current rate of 5-7% is aimed at equating the payments of every coal miner in the archipelago, the timing is questionable as is the likely impact on small mining companies. Globally the industry is struggling from a number of factors, including low prices, rising supply and lack of capital, and Indonesia’s producers are being hit hard.