Metals & Mining

Sector

Metals & Mining

Sumit Gurav
Sumit Gurav

Sector Expert
   

Snapshot

The Global Metals & Mining industry total revenues of $2,643.3 Bn in 2018
Numerous industries worldwide are dependent on the supply of commodities from underground like minerals and metals. The dependency of various high-tech industries on rare earth’s minerals is a recent issue such as coal, but on the other hand, it is still one of the leading global energy resources. Consequently, the mining sector is crucial to the world’s economy. The top 40 global mining companies, which represent a vast majority of the whole industry, reported some $683 Bn of revenue in 2018. The net profit margin of this industry decreased from 25% in 2010 to 10% in 2018. In terms of volume, the most used commodities worldwide are coal, iron ore, bauxite, and potash. China and the United States are the leading coal producing countries. China and therefore the US are the most important coal producing countries. China is also the third-largest producer of iron ore. Thus, China is becoming the highest mining country for several commodities, especially for the highly demanded rare earths, of which China produced over 70 percent of the global production in 2018. Additionally, China is that the world’s leading country within the mine production of gold.
Metals Overview

$ 1 Bn
Top 40 Mining Companies Revenue
$ 1 Bn
Total assets of top Mining Companies
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Australia mine production of Gold
INDUSTRY SCENARIO FOREIGN INVESTMENT INDUSTRY TRENDS MAJOR PLAYER

The industry’s leading companies based on market capitalization are Anglo-Australian BHP Billiton and Rio Tinto, followed by Newmont Goldcorp of the United States. As of August 2019, BHP Billiton had a market capitalization of 121 billion U.S. dollars. Measured by revenue, the top company active in mining worldwide is Anglo-Swiss Glencore, generating some $220 Bn in 2018. However, it has to be taken into consideration that a large share of Glencore’s revenues come from commodity trading. In 2018, four of the world's ten leading mining companies supported revenue were based within the UK. In the U.S., mining has always played a crucial role. Its importance increases all the more whenever mining includes the extraction of oil and gas, and support activities for mining, as some sources do. Australia and Brazil are some of the largest Iron Ore producers in the world.

  • The total U.S. mining gross output in 2018 amounted to $624 Bn
  • US Mining sector employed around 672,000 people
  • China top importer of Iron Ore with volumes of 1075.4 Metric Tons
  • Australia top exporter of Iron Ore with volumes of 887.43 Metric Tons
  • Global Seaborne Trade Transport of Iron Ore is 1,470 Metric Tons
  • Nearly 2/3rd of Global Iron Ore exports are to China around 1.08 Bn Metric Tons

The mining and metals sector has been very vibrant in terms of mergers and acquisitions over the last few years. In 2010, a record high of 1,123 deals worldwide were reported, a number which stood at only 392 about 10 years earlier. In 2017, some 448 deals worth around $51 Bn were completed. In terms useful, the main commodities targeted by these transactions included gold, coal, and lead-zinc. Metal organisations move to consolidate their footprints in lower cost centres & increase their focus on cost cuttings. Many have started to pour investments into R&D & innovation in order to move further up in the value chain & capture new areas of growth. This focus will likely in turn will help in improving value & shore up margins for metal organisations.

  • Total value of deals in the mining & metal sector worldwide was $77.8 Bn
  • Average Value of Deals in the Mining & Metal Sector amounted to $111 Bn
  • 94% companies are investing in overseas market to obtain lower manufacturing costs
  • 26% Organisations are investing in a view to move close near to the customer
  • Wandle Holdings of Russia acquired the United Kingdom's Polyus Gold International in a deal valued at $5.38 Bn
  • Largest Global mining & metals acquisition happened in 2015 by the Shareholder’s acquisition of BHP Billiton

The mining industry contributes notably toward the economic and industrial growth of a nation. Major mining metals include lead, copper, tin, zinc, nickel, cobalt, and aluminium. Gold, platinum, palladium, and silver are among the valuable mining metals. The global mining metals market has been among the fastest growing market. In recent times, the market has witnessed slow growth due to the economic slowdown across nations. Iron ore, gold, copper, and nickel are the most prominent investment targets for mining companies as these premium metals are expected to play a pivotal role in future projects. It is observed that mining companies are increasingly exploring the benefits of vertical integration to control the entire value chain of the market. Market players are that specialize in every phase of the worth chain, right from mining to production. However, to regulate the worth chain, mining companies got to control operating costs also as commodity prices.

  • The Global Metals & Mining industry to represent CAGR of 2.1%
  • Production volume to increase with a CAGR of 0.2%
  • The Iron & Steel segment stands to be the industry’s most lucrative industry with a share of 62.7%
  • Global Base Metal Mining market size projected to grow CAGR of 4.1%
  • Global Base Metal Mining market expected to increase from $339 Bn in 2019 to $431 Bn in 2025
  • In 2018, 4 of the world's 10 leading mining companies based on revenue were based in the UK
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