South African labour union to strike at ArcelorMittal over job cuts
Africa's biggest steel producer was rocked by a two-week wage strike in May 2022.
High costs, declining prices and risk-averse investors are hindering miners ability to leverage capital which will cause dozens of companies to falter this year, reports the Financial Times.
In a sample from around the world, 43% of companies — about 167 miners — had cash balances of less than $2 million, according to a new report released Sunday by accounting firm Grant Thornton. When looking at companies who had nothing in production yet, the number rises to more than 200 miners.
The accountants surveyed 389 small and large companies from Australia, Canada, Britain and South Africa. More than half of the junior miners need funding within the next three months or less to pay all their debts.
With prices declining, such as for copper and iron ore, and costs rising, such as for labour and energy supply, many miners are cash poor.
Some analysts are predicting an increase in mergers and acquisitions as companies who do have cash swallow smaller companies.
Funding is a global issue, said Grant Thornton’s Australian head of energy and resources, adding many exploration companies are challenged to raise funds and are “down to the wire.”
High costs and low prices have hit miners of all sizes.
Large companies are no exception, with some notable changes at big corporations like Rio Tinto, BHP Billiton and Anglo American to appease upset investors.
Image: MAT / Shutterstock.com
