THERE is no question the global mining industry is not as strong as it was at the start of 2012 thanks to a gloomy Europe, slowing Chinese growth, depressed metal prices and lack of capital for exploration, development and expansion projects, but it was undoubtedly a case of glass half full at MINExpo 2012 in Las Vegas. While acknowledging the difficult conditions, most mining executives and leaders at the world’s biggest mining showcase were very optimistic about the future.

About 55,000 delegates at MINExpo heard that the minerals, metals and coal industry will be responsible for leading global economic growth as unprecedented demand kicks off an international supply chain effect. The expo was already the world’s largest mining equipment, products and services convention, but the 2012 event broke records for attendance from delegates of 36 countries, using 860,000 square feet of exhibition space and procuring equipment and after-market sales of more than US$52 billion.

The overwhelming mood of optimism underlying this year’s event is being attributed to the massive demand being driven by exponential urbanization and energy consumption in developing nations, and particularly those in Asia. Four of the world’s leading producers of mining equipment, coal and minerals spoke in agreeance at a CEO panel in front of more than 1200 delegates.

Peabody Energy chairman Gregory Boyce said the strong growth in global coal demand is being powered by rapidly expanding economies, where the rapidly growing middle class in China, India and African countries is pushing growth in demand across the sector. “Energy is a basic human right, yet today 3.6 billion people in the world have either little or no access to electricity. Coal will be critically important for providing this vast region of the world with affordable electricity.”

MINExpo 2012 chairman and president of Joy Global Michael Sutherlin said developing countries in Asia were only mid-way in their growth curve as measured by metal intensity per capita, with China at the same parity now with the developed world that Japan was in the 1950s.

Newmont Mining’s chief executive officer Richard O’Brien dismissed the myth that global competition for natural resources may come at the expense of the environment and safety. “Mining operations anywhere in the world that are the safest and most environmentally sound are also the most productive mines with the most talented workforce. If we don’t get the environment and safety right, we will lose our social licence to operate.”

The optimism was shared by equipment manufacturer Caterpillar. “I know there are lots of headlines that mining is dead, not one more ounce of coal will ever be mined, iron ore will never come back, the world is going to stop spinning, it’s over,” Caterpillar’s chief executive Doug Oberhelman said. “Well, it’s not over.”

Asia in general and China specifically were hot topics of discussion during most MINExpo sessions and among the vast majority of the more than 1860 exhibitors. And little wonder because not only is growth continuing, albeit at more sustainable levels than in previous years, but Asia’s domestic mining industries continue to flourish as they strive for self-sufficiency.

Evidence of this came during a recent presentation by IntierraRMG’s editorial director Chris Hinde who commented that it is often forgotten that not only is China the biggest user of natural resources, it is also by far the largest national producer, and the Asian dominance of minerals production is growing.

According to IntierraRMG’s database, Asian production, of which China is by far the largest constituent, accounts for more than 61% of the world’s coal output (7.695 billion tonnes last year), compared with a share of only 44% 10 years ago (when global production was 4.850 billion tonnes).

Asia last year accounted for 31% of the world’s iron-ore output of 1.980 million tonnes, which was twice the amount produced globally in 2002, when Asia’s share was barely 23%. Asia now captures almost one-third of the world’s bauxite output, compared with barely 19% in 2002. The continent achieved 26% of global gold production last year, compared with 21% of the similar total gold production in 2002. In contrast, Asia’s share of copper production has slipped slightly. The region accounted for 19% of last year’s global 16.3 million tonnes, compared with almost 20% of 13.6 million tonnes in 2002.

 

 

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John Miller, Editor

John Miller, Editor, The ASIA Miner
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Editor, ASIA Miner and Australian Editor, E&MJ
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Based in Melbourne, Victoria, Australia, John Miller has been working as a mining journalist for The ASIA Miner for the past seven years, focusing on mining developments throughout Asia and Australia. He was promoted to editor, The ASIA Miner, during July 2010, is editor of Coal Age Indonesia and has responsibility for E&MJ Australian coverage. John has more than 30 years experience as a journalist. He is also an author with more than five historical books published and a biography published. He has also served his community as a city Councillor and was mayor of Orange from 2002 to 2004.