Categories: General Market Commentary
Topics: General Market Commentary

Rethinking mining strategies among the top-10 global trends to shape 2019

2019 could go down in history as the year mining companies stopped anchoring their strategic planning around producing the highest volumes of ore at the lowest possible cost, and understood that focusing on the composition of their portfolios to offer a unique investment opportunity was the key to success, a study published Tuesday shows.

Deloitte’s “Tracking the Trends” annual mining report, now in its 11th edition, outlines how the challenges and opportunities the industry faces and proposes way to adapt to fast changes.

Mining companies, it says, now need to determine how to operate in a market that is also characterized by rising stakeholder demands, a widening talent gap, dwindling access to key inputs such as energy and water, and a Chinese economy growing at under 7%, rather than 12%, just to mention some challenges.

“In today’s climate, miners must focus on differentiating their business models to generate long-term value, not only to attract investors, but also to remain successful in the communities in which they operate,” Deloitte’s Canada and Global Consulting Leader Mining & Metals, Andrew Swart, said.

“We believe there is a significant opportunity for mining companies to harness the power of data and analytics,” he told MINING.com.  “As mining companies invest in technology, be it in the core operational or supporting processes, companies should be doing it with a view of how they will collect and utilize data going forward.”

Miners, he explained, need to ensure that they can gather data from pieces of equipment in real time or deploy sensors in key process areas, so that they can leverage the power of data to optimize those processes in real time.

The Fourth Revolution

The report notes how conversations around the fourth industrial revolution, or Industry 4.0, revolve around the ways in which physical and digital technologies — such as analytics, AI, cognitive technologies, robotics, cloud computing, and the IoT— are combining to create digital enterprises that are both interconnected and capable of more informed decision- making.

For Glenn Ives, Americas Mining and Metals Leader at Deloitte Canada, it represents a new era of business that can only be harnessed by leaders who have “the courage of their conviction.”

Beyond rethinking their mining strategy, companies should pay attention to other top growing industry trends that would determine their success. According to Deloitte, they are:

  • The frontier of analytics and artificial intelligence (AI): Mining companies are investing in analytics and AI in a bid to leverage the data they generate to sharpen planning and decision-making across the mining value chain. This could improve safety, increase productivity, reduce costs, and enhance the employee experience. As they consider how to move up the analytics and AI maturity ladder, miners are learning from global trends in other industries, exploring new use cases, and determining where best to focus their investment.
  • Managing risk in the digital era: In today’s broadened risk landscape, traditional assurances around risk are no longer effective. Boards, investors, and communities expect mining companies to have a forward-looking view on risk, moving from risk assurance to the anticipation of emerging risks. This will be enabled by analytics and a range of AI and cognitive tools that are now available to mining companies.
  • Digitizing the supply chain: The mining sector is at the earliest stages of building a digital supply network (DSN). The organizations that determine how to interlink their supply chains, from pit-to-port, can do more than break down operational silos. They can also gain the end-to-end visibility needed to enhance their asset utilization, operational efficiency, and productivity—realizing hard dollar savings as a result.

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