Recently the European Union fading, it was predicted that the world “polarization” has already begun, the economic development of the situation determines the mining developments. After five consecutive years of decline, the overall situation in the first half of 2016 the mining industry is still in the doldrums, the situation is not optimistic, but in some areas of the mining industry also appeared some new situations. Sort out some of the new global mining development.
From a fundamental point of view the market minerals, the current disappointing macroeconomic data, there is no fundamental change in the reality of insufficient demand, oversupply situation has not changed. Thus, behind the rising prices of another promoter. In the first quarter of this year, about $ 24 billion of new money flowing into the mineral related funds, and short sellers covering buying, as well as global investors will push the negative interest rate environment is also a major force behind the mining investment, which affects the gold, silver, iron ore and other major metals prices in the past six months. Therefore, financial factors should be the key driver of the recent rise in metal prices, with the result that commodity prices volatility, lack of sustained rally support.
Overall the second half of 2016 and the first half of the chain of supply and demand has intensified, but the supply and demand was flat compared with last year, seasonal fluctuations will become the main theme of this year’s ore price trend. From the point of view of supply and demand structure of the iron ore market may exhibit the following characteristics: port inventories remain high this year, compared with last year to enhance the overall level of the Port; the second half of the main ore accounted again rose to high, and further expand the proportion of non-mainstream ore supply reduction; iron ore continued to increase dependence on foreign trade, domestic mine eliminated slowdown; steel stocks overall remain low, affected by the phase difference between the supply and demand elasticity compared with last year increased.
While most minerals by weak demand affected the future is likely to remain volatile situation, but nickel and tin are two exceptions however, deserves special attention. According to data from the International Nickel Study Group (INSG) released in May, by Chinese demand for nickel in stainless steel production expanded brought a surge in one-third to promote, March global nickel market supply and demand gap from 6000 tons in February to expand rapidly to 8200 tons. 2016 the year the overall market may enter a nickel short supply. 2016 Tin also noteworthy minerals. Affected by supply reform, in 2016 tin industry supply and inventories simultaneously reduced circumstances. Production from China and Indonesia, the two major suppliers of tin, the 2015 annual production up sharply reduced, and the world’s tin mine production decreased by more than 25,000 tons. Large tin consumption in new areas of chemical, lead-acid batteries and other growth potential. It is reasoned that the two metals nickel and tin, or will occur in the future supply and demand fundamentals reversal, price or rise into the channel.
By the global economic downturn, the supply of bulk mineral resource area is still surplus, market into a buyer’s market, forcing the country to adjust the supply of global mineral resources strategy, have released a new strategy to attract investment and improve their competitiveness, and the potential value of having a resource depression also improved due to the policy favored by the mining industry, mining supply will be more abundant and more diversified.
May 10, 2016, the Ministry of Finance and the State Administration of Taxation jointly released “comprehensively promote resource tax reform”, which announced that with effect from July 1, 2016, our country comprehensively promote resource tax reform. According to the notification requirement has been crude oil, natural gas, coal, rare earth, tungsten, molybdenum six items resource tax reform and the implementation of ad valorem basis on the implementation of this reform will be the vast majority of minerals ad valorem.
The mineral resources compensation reform will rate all of the resources heading down to zero, banned local charges for violation of mineral resources fund projects set up, in addition, the Ministry is exploring the establishment of national interest in the mineral resources reserve system. Through this reform will further promote the tax legislation clearing fees, taxes and rationalize the relationship between resources sector, to further standardize the country’s mining market.
Traditional mining development model can not meet the new situation, the future of mining companies must change the concept of development, always looking back to the past that “money lying all” model was not possible, we must accelerate technological innovation and increase productivity and upgrades, build a new business model in order to achieve profitable growth and win the future, to adapt to mining “new normal.”