Australian mining leaders have gone into “survival mode” since accepting that today’s tough market conditions are beyond their control.
A Newport Consulting survey of 60 mining executives found many bunkering down, with 44% intent on reducing capital expenditure – the first time any participant had picked that response in the survey’s four years.
Only 14% of participants signalled that they would increase spending, compared to about two-thirds last year.
More than half of the survey respondents attributed their pessimism to the volatile market (54%), followed by falling demand (19%) and prices (12%).
“Mining leaders appear to have accepted market conditions they have no control over, such as falling commodity prices, and are turning to focus on what they can control – costs, productivity and operating more efficiently,” Newport reported.
“Mining leaders spoke at lengths about project cost blowouts they have experienced over the last year, and how this has reduced their spend on new projects.
“Weaker demand, a higher dollar and regulatory burdens from the carbon and mining taxes have forced miners to focus on reducing costs over the last six months through job culls, small mine closures and project expansion delay.”
Newport’s report is here.
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