Global Mining Development report (2020-2021) released

On October 22nd, at the 23rd China International Mining Congress, the International Mining Research Center of the China Geological Survey of the Ministry of Natural Resources released the Global Mining Development report (2020-2021). The report is the first report in the world to make a comprehensive analysis of the global mining development trend since the COVID-19 epidemic, and it is also an important research achievement of Chinese research institutions serving the sustainable development of the global mining industry.

The report shows that since the outbreak of the COVID-19 epidemic, the overall global demand for energy resources has shrunk, the structure has been divided, the consumption of energy and bulk minerals has declined, and the consumption of new energy minerals has increased rapidly. In 2020, total global energy consumption fell by 4.5 per cent, the largest decline since World War II; oil, coal and natural gas fell by 9.5 per cent, 3.9 per cent and 2.1 per cent respectively, and renewable energy such as wind power, hydropower and solar energy increased by 9.7 per cent. Iron and aluminum decreased by 0.2% and 0.7% respectively, while copper, lithium and cobalt increased by 6.2%, 15.3% and 7.3%, respectively.

The supply capacity of global mineral resources has been destroyed, and the fragility of the resource supply chain has been highlighted. The epidemic has a great impact on global mine production. According to incomplete statistics, 36 countries or regions once closed 276 mines, and more than 1600 mining projects were affected by the epidemic. In 2020, total global production of major mineral products was 3.7% lower than in 2019. Among them, the output of energy, metal and non-metallic mineral products decreased by 5.1%, 1.4% and 0.5% respectively compared with the same period last year, and the decline in energy and mineral products production was higher than that in consumption. At the same time, the normal international trade of mineral products is affected, which seriously affects the security and stability of the global mineral resources supply chain.

The prices of major mineral products around the world rebounded in the shape of "tick", with prices of gold, copper, iron ore and other minerals reaching record highs. In 2020, global investment in mineral exploration and mining industry will be about US $8.3 billion and US $290 billion respectively, a decrease of 11% and 13% respectively compared with 2019, and is expected to return to 2019 level in 2021. The global mining capital market first suppressed and then rose, and the capital attention of the mining sector increased significantly. In 2020, the number and amount of global mining project financing increased by 17% and 25% respectively compared with the same period last year. The trend of "simultaneous rise in volume and price" continued in the first half of 2021, with year-on-year increases of 12% and 261% respectively.

The mining policies of major countries and regions have been adjusted intensively, and challenges and opportunities coexist. On the whole, global mining investment faces three major risks, namely, the increase of political and security risks characterized by regime change and social unrest, and the rise of protectionism characterized by tax increase and nationalization. mining investment barriers characterized by increased security review are rising. At the same time, some mining countries provide opportunities and facilities for international mining investment by relaxing mining controls and introducing preferential policies.

The performance and comprehensive strength of mining companies continue to differentiate, speeding up the layout of new energy minerals. Since the epidemic, the profits of oil and gas companies have fallen sharply, and the profits of large mining companies dominated by solid minerals have been stable. Since the second half of 2020, the performance of mining companies has generally rebounded, and revenue and market capitalization have continued to rise. The combined market capitalization of the world's top 50 mining companies reached 1.47 trillion US dollars, an all-time high. Mining giant comprehensive strength to further enhance, accelerate the layout of copper and lithium, cobalt, nickel and other new energy minerals.

Climate change promotes the transformation of human production and life style to low carbon, and the global supply and demand structure of mineral resources and mining pattern are giving birth to major changes. Under the background of low-carbon economy, the growth rate of demand for traditional mineral resources has further slowed down, and the demand for clean energy and strategic emerging minerals is growing rapidly. The status of suppliers of traditional energy resources such as coal, oil, iron and manganese will decline, while the status of strategic emerging mineral suppliers such as lithium, cobalt and nickel will continue to rise.

China has rapidly controlled the epidemic, rapidly recovered its economy, played the role of the engine of the world economy, and effectively boosted the global consumption demand for energy and resources. In 2020, with the overall shrinking global demand for mineral resources, China bucked the trend. Oil, iron, copper and aluminum consumption increased by 2.0%, 9.1%, 17.1% and 6.4% respectively compared with the same period last year, while imports increased by 7.3%, 9.5%, 33% and 10.9% respectively. It has played an important role in stabilizing the global mining market. At the same time, through mutually beneficial international mining cooperation, China has established positive bilateral relations with other countries in the development and trade of mineral resources, actively maintained the normal order of international mineral trade, and promoted the opening up, cooperation and common development of the global mining industry.

The report predicts that with the rapid rebound in market demand after the epidemic, expectations for the withdrawal of large-scale quantitative easing policies in major developed economies are rising, and there is a structural differentiation in the supply chain and industrial chain of mineral resources, bringing uncertainty to the development of the global mining industry, and the continuous concussion and adjustment of the mining market has become the norm. In the medium to long term, the global demand for mineral resources will differentiate, the demand for strategic emerging minerals will accelerate, and the demand for mineral resources in China and other emerging economies will remain at a high level, which will certainly promote the sustainable development and structural changes of the global mining industry.