Mining’s old guard needs strong medicine
A new report details subpar investor returns in the mining industry over the last decade, particularly big cap diversified companies which have not adapted to new realities.
OTTAWA, March 5, 2018 – The year 2017 brought with it upward pressure on mineral and metal prices, returning a cautious optimism to the global mining industry. Pending the right conditions, Canada could seize significant growth opportunities in mining in the years ahead, according to the Mining Association of Canada’s (MAC) latest report on the health of the sector.
“The report concludes that there is strong potential for growth in Canada’s mining industry, which would result in our sector expanding its already significant socio-economic benefits to Canadians. These benefits would be felt across the country, in our smallest communities and largest cities,” stated Pierre Gratton, President and CEO. “With the turnaround upon us and global demand for minerals and metals poised to increase, Canada must focus on boosting its attractiveness as a destination for mineral investment or risk losing opportunities to other countries.”
Looking forward, the Canadian mining industry’s economic prospects are strong over the long term. Demand for mining products is projected to increase as the middle classes of the world’s most populous countries continue to emerge, and as their consumption patterns more closely resemble those of western industrialized countries. Another significant growth opportunity is the global transition to a low carbon future, which will serve to increase the demand for minerals and metals as the building blocks of clean and low energy technologies.
“It is a jurisdiction’s policy and fiscal environment that truly is the deciding factor when companies are deciding where to invest. Unfortunately, indicators suggest that Canada is not as competitive as it once was and the industry requires strategic policies that would encourage sustainable mining development. If we get these pieces right, Canada can meet the growing demand for minerals and metals, today and in a low carbon future,” stated Gratton.
Key findings from MAC’s Facts & Figures 2017 report:
· Canada’s mining industry employs 403,000 people directly and 193,000 workers indirectly across Canada.
· The mining industry is the largest private sector employer of Indigenous peoples in Canada on a proportional basis, and a major customer of Indigenous-owned businesses.
· There are more than 400 active agreements between mining companies and Indigenous communities. These agreements help ensure mining projects bring long-lasting benefits to local communities through support for education, skills training, employment, business development, and more.
· The average annual pay for a mining worker in 2016 exceeded $100,000, higher than the forestry, manufacturing, finance and construction sectors.
· The mining industry is deeply interconnected to other sectors of the Canadian economy, with more than 3,700 companies supplying goods and services to the Canadian mining industry.
· In 2016, Canada’s mining sector contributed $57.6 billion to the national GDP, and accounted for 19% of the value of Canadian goods exports.
To download a copy of Facts & Figures 2017, please visit www.mining.ca/facts-and-figures-2017.
