Experts say the future of metal mining looks bright, despite the recent drop in metal and precious mineral prices over the past few years.
Even though precious and industrial metals saw their values plummet over the last three years, industry analysts say there’s no need to panic.
In 2014 the World Economic Forum established the Industry Agency Council (IAC), consisting of over 200 sector experts, business leaders, investment advisors, and policy analysts to develop predictions and outlooks for the industry into 2030. According to Investopedia, the IAC found that the industry’s long-term outlook is strong.
The Council identified over 50 driving forces affecting the price of precious and industrial metal commodities around the world. These include social, technological, economic, and geopolitical factors ranging from population growth, to scientific innovation, to global economic growth.
In general, Brazil, Russia, India, and China (known as BRIC) continue to exert a huge influence over the industry, particularly for industrial metals like copper and steel. The value of these metals is inextricably tied to economic growth in China and India.
The future impact of these growing giants is difficult to measure, but it should be considerable — many of the world’s top mining companies are majority-owned in China, India, and Brazil.
Though gold is only a small part of the industry, its price changes are always carefully watched. Gold prices reached a peak in 2011, but have fallen far since then. Still, Investopedia calls gold and silver “safe havens during times of recession, inflation, or uncertain monetary policy.”
The Financial Post reports that Rob McEwan, CEO of McEwan Mining, Inc., told investors that in spite of falling share prices, he expects the cost of gold to soon rise to $5,000 per ounce.
The Future of Metal Mining
As with any major business, the future of the metal mining industry is shaped by resource scarcity and product innovation. As resources dwindle, their costs rise, while innovation results in new products that push consumers to other markets.
In mining, metals and minerals eventually become more and more difficult to reach, forcing companies to pour more money into a mine or shut it down entirely.
A Brighter Outlook
Experts are recommending that the time is right to invest in the metal mining sector. Prices for precious and industrial metals dropped in 2013-2014, leading public investors to decide against investing in early 2015. They predict this will lead to lower prices in the industry and, subsequently, better buying opportunities.
One of the obstacles facing mining companies in the future will be adapting to increasingly rigorous environmental regulations around the world. The resulting higher taxes may lead companies to slow or stop production altogether.
How Can Midwest Help?
Midwest Industrial Supply, Inc. offers environmentally safe solutions to common metal and mineral industry problems, including mine dust control and mine tailings management. Their Metal and Mineral Mining Solutions ensure that all machinery and equipment used in the mining process is safe and durable, while their Haul Road Dust Control Solutions minimize the harmful effects of dust on roads.
They also offer environmentally-sound products for Mine Tailing that prevent harmful particles from escaping the surface and contaminating surrounding areas.
No matter the solution or combination thereof, Midwest knows how to keep mining operations as safe and efficient as possible. Visit their website to see what solutions work best for you.
(Image credit: Magnus von Koeller/flickr)