Deep sea mining puts $560 billion in land extraction at risk — report
Even in optimal scenarios, the activity would generate only $6.25 million in tax revenue for countries involved, says Planet Tracker.
Mining companies are starting to see signs of easing costs to dig up industrial metals, after spending months dealing with accelerating inflation that eroded earnings.
The financial chiefs of First Quantum Minerals Ltd. and Lundin Mining Corp. noted a shifting trend on costs for mine supplies during their third-quarter earnings calls, signaling potential improvements on expenses to produce much needed industrial metals such as copper.
“We did see some early positive green shoots on cost inflation as some input costs started to fall later in the end of this quarter,” First Quantum Chief Financial Officer Ryan MacWilliam said in Wednesday’s call. Oil prices fell between June and September, while marine freight costs slid by about 15%, he said. Sulfur prices — which represent 20% of the costs at its Australian nickel mine — plunged by 80%.
Lundin CFO Teitur Poulsen said total costs in the first nine months of 2022 were 20% higher than last year, an indication of overall inflationary pressures mainly in the first half. “Looking at the numbers now it seems certainly to be flattening out and potentially even dropping down a bit in certain jurisdictions.”
The comments by the Canadian miners come about three weeks after Southern Copper Corp.’s CFO said he expects third-quarter costs to be down from the prior three-month period thanks to easing prices of inputs such as fuel and explosives. Southern Copper, the world’s fifth-largest producer, is expected to report quarterly results this week.
Relief may not be immediate, though, for metals producers.
“While these costs are now starting to slowly move in the right direction, the full effect of this reduction will not be felt until 2023,” First Quantum’s MacWilliam said.
(By Jacob Lorinc, with assistance from James Attwood)
Comments