Los Bronces copper mine in Chile. (Image courtesy of Anglo American | Flickr.)
Global miners, particularly Canadians, are showing increasing signs of optimism as commodity prices are on the rise, shallow growth is returning to different end markets, and most are in better cost positions than in the recent past, the annual "Tracking the Trends" report by Deloitte released Wednesday shows.
However challenges remain, and the industry is still likely to have to deal with cyber-security threats, technological disruption and environmental issues, it warns.
"It is critical that companies are aware that with technological and digital disruption occurring across all industries, comes accelerated threats to the mining industry," notes Phil Hopwood, Deloitte's Canadian and Global Mining Leader.
Mining companies should be looking for the answer to one common question: "Going forward, where should we play and how can we win?"As in the past years, the consultancy firm outlines the top 10 challenges miners are likely to face, as well as the possible solutions to them, which can be summarized as:
Cyber attacks and other threats: Mining companies are subject to a wide range of risks, and with an evolving threat landscape, leaders must strengthen their cyber-security programs.Unlocking productivity through innovation: Think beyond driverless trucks, sensors and advanced analytics to reduce cost, streamline equipment maintenance and prevent safety incidents. Today, new technology such as drones, real-time modeling and geo-coding are driving the next wave of productivity gains.Digital revolution: Miners must figure out how to turn the potential benefits of digital thinking into reality.Improving shareholder value: Optimizing portfolios, strengthening M&A processes, sustaining focus on cost and making long-term investments are key to improving this performance.Creating healthy and inclusive workforces: Miners need to recognize that productivity goes beyond reducing costs and streamlining processes: mental health, wellness and diversity should also be considered and addressed.Operating in an ecosystem: Companies will need to shift from a go-it-alone mentality, to one that recognizes the value of operating within an ecosystem.Unlike in previous versions of Deloitte's report, this year's includes a wide range of case studies and sector-tailored recommendations.
"Companies that mine iron ore or thermal coal, for instance, have an entirely different outlook than those heavily weighted in precious metals," the study acknowledges. "Diversified miners face different challenges than companies with a niche commodity focus. Major producers are planning for a very different future than the one that appears on the horizon of most junior explorers," it notes.
However, the analysts conclude that while mining companies' approaches to the future will (and should) differ, all of them need to be looking for the answer to one common question: "Going forward, where should we play and how can we win?"
The full "Tracking the Trends" report is available here.