Thursday, 19 December 2013

A Good Future for Miners Ahead

According to EY’s Capital Confidence Barometer, Mining and Metal Sector, the confident level in this sector has increased drastically over a period of last 12 months. When only 38% of the mining companies were focusing on growth and expansion last year about 55% on the companies are on the verge of expansion presently. EV states the main reason for this development as the increasingly stable global economy, especially in the mature markets.

During last few years the transactions in the mining and metal industry were falling down drastically. Struggles faced in capital allocation and the access to the capital challenges was stated as the reason for this down fall. Anyway the GDP growth has returned in all mature markets and this improves the credit availabilities too. Even though, the preference in this sector is still on low risk investments, which may results in mergers or acquisitions. Similarly, investors are not so enthusiastic to invest in this sector although banks and other financial institutions are ready to lend. However, this is dismissed as a fear that aroused form the experience of the past and according to experts in this sector the trend will change in favor of mining and metal sector within another six months or so.
According to the experts only 57% were of the opinion that the global economy is improving about six months back and now almost 72% believe. This clearly underlines the changing mind of people who have the ability to invest. As the time passes, the apprehensions about the mining sector also will go off from their mind and they will come forward to invest here also. Many expect.
Earlier also there were reports from different parts of the world about the improvements witnessed in this sector. Altogether it make us to believe that the miners are going to enjoy a bright future from next year onward.

Monday, 9 December 2013

Mining Jobs on a Leap in Australia

It is great news for all. In a recent study report, the research firm BIS Shrapnet has predicted a hike in the job opportunities in the mining sector in Australia. This will more in iron ore and liquefied natural gas sectors.
In their detailed study report they claim that the export of both these commodities will increase in the coming years and the GDP share of these sectors will increase from 18.7% to 19.8 %. They have earlier predicted a hike in the investments in mining sector and 2012 and 2013 witnessed that boom. According to their report this will reduce to by 20% in the coming 5 years. At the same time the mining production will increase by 41% which will increase the related activities such as maintenance and exports. These are the areas where there is a large work force is required in all levels and a large number of people with different educational qualifications will get opportunities in this boom.

According to many experts, this boom in the mining sector, which is predicted for another five years will certainly influence the economical growth of Australia. Increased production and exports will certainly pump in lot of money and other sectors such as construction, manufacturing etc will start booming using this money. Hence, there will not be a problem if a slow down happens in the mining sector after these five years.
However, the miners are not seeing any luck in this boom as they will be squeezed by the low commodity prices and high Australian dollar rates. Still they can make enough profit as the production increases.

Friday, 6 December 2013

Now it is the Turn of North Korea in Rare Earths

Rare earth elements are always in demand as they were the most important raw materials in various industries such as green house technology, defense products and consumer electronic products. Initially they were sourced from the placer deposits in India and Brazil in early 1940’s, but South Africa dominated in the production in 1950’s.  However, from 1960’s , U. S take over the regime and the major supply started coming from the Mountain Pass mine in California. This continued till 1980’s and then China entered in the market with 95% of the world’s total rare earth coming from Mongolia. China is not only the major supplier, but also became the major consumer of rare earths going ahead of Japan and South Korea. 

China’s monopoly in the production and its role as the major consumer increased the rates and after 1980’s price of some rare earth elements have gone up twenty folders high. Alarming increase in the prices sent warning alarms and the exploitation for rare earths has started world over. As a result fresh source of rare earths have been found at different places such as Canada, Green Lands, Malaysia etc. It has been found at some places in Australia too. Although it was not sufficient to meet the requirements of the world other than China, it became a reason to bring down the prices considerably. This gave a fresh breath to the industries where rare earths are most important raw materials.
Mining center in North Korea

As good news to the industry, a private firm that has been hired by the North Korean authorities has announced the finding of world’s largest rare earth source. SRE, the private firm which discovered this source has already signed a contract of 25 years to explore the resources with the Korea Natural Resources Trading Council. The joint venture company, Pacific Century Rare Earth Mineral Limited has also given permission for a processing plant at the site. The site Jongui is located about 150 kilometers northwest of the national capital Pyongyang.
Experts are of the opinion that this new development will help to bring down the prices further and this will help the different industries, especially consumer electronics a lot. Approximately, 216 million tons of rare earth deposits are believed to be here in this region which is the largest in the world.  

Monday, 21 October 2013

Will Chinese Renminbi (RMB) replace Dollar in International trade?

China with its emerging economy is all set to put a challenge to the so far undisputed place of US dollars in international trade. China consumes about half of the base metals produced in the world. It buys almost 42% of the total copper produced in the world and about one billion metric tons of iron too. Recently China became the largest importer of oil in the world and all set to pass the record of India as the largest importer of gold. 
Chinese Currency

In such a condition nobody will get surprised if the Chinese RMB got approval as the currency for international trade. This currency is being used as a settlement currency in Australia and this practice has been increased in the near past. According to HSBC, RMB will become the third largest unit used for trade by 2015. Although China had to suffer severely during the treasury shutdown in US as it was the major holder of US treasury bonds, it could recover from the fall very fast.
Now, China is one of the most sought after manufacturing hubs in the world. With cheap labor and availability of raw materials China attracts manufacturers from world over to its soil to start units. Excellent infrastructure and comparatively well maintained public disciple are the other two factors which turn the decision in favor of China when the question is about to start a manufacturing unit.
After making their domestic economy stable now the dragons are all set to conquer the world of business with RMB. A recent commentary in China’s state media is considered as a sign of this. During treasury shutdowns in US, media in China called for a de-Americanised world where small and big countries will have their key interested protected and will get an equal treatment.
When we go by the history of China, it is proven that they have achieved almost everything they aspired for. If the history has to repeat once again, we can see Chinese Renminbi (RMB) in the place of US dollars very soon.

Sunday, 20 October 2013

The Mozambican Answer for Environmental Issues Related to Mining

Mining may be the sector that attracts maximum number of protests from the environmentalists. It is the same sector that has been held responsible for many environmental issues all over the world. We cannot deny the fact that mining causes an ecological imbalance and affects the natural environment of the region. However, we cannot stop mining for the sake of environment as it is one of the most important sectors that are responsible for the life today.
People from different walks of life depend on mining to continue living either directly or indirectly. You cannot even think about living without oil, metals and several other minerals which are used in the production of many articles we consider as essential things to live. So the best solution is to avoid the damages to the nature or minimize it.
Rising to the occasion, many mining companies have implemented various measures to minimize the effects on ecology. They are investing more on Eco-friendly mining equipments and tools and trying to avoid cutting down trees in the area as far as possible. Recently, LNG trucks have been introduced at many mining fields to minimize the pollution caused by diesel vehicles. 

Now the government in Mozambique has come out with a unique project to protect the environment in the Tete Province. 60% of this region is allocated to coal mines and many environmental activists and agencies have raised concerns many times in the past. The nation was not in a position to declare a ban on coal mining as it constitutes major part of its total revenue. After a series of discussions and debates the government has planned to start up a national park spreading across an area of 350,000 hectors here. The parks will have Hippos, Elephants, Lions and Tigers among other animals. As the area selected for building national park is with lot of trees and other geographical structures, it will not take much time to start the park.
Mozambique, which has one of the largest coal resources in the world, attracted the attention of many mining companies from the western hemisphere of the earth. Many well reputed mining giants have interests in this soil. Now they are in bit confusion on the government’s decision to balance the environment. They are worried but not started protesting against this new move of the government. Anyway, environmental activists and organizations are welcoming this initiative wholeheartedly.