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Asia Pacific is the leading producer as well as consumer of gold with major consumption in South East Asian countries. High growth in India, China and South East Asian countries coupled with rising disposable income of the general population is the major driver for the growth of the market, in the region.

The diverse demand for gold is for, jewellery, technology, and by central banks and investors. Global gold supply is a mixture of mined gold, scrap recovery and central-bank supply. More than half of gold supply worldwide comes from mined gold. China is the largest producer of mined gold

Ken Research announced its latest publication on,’ Global Gold Mining to 2020’, which provides detailed information on the market trends in the Gold industry. In addition, the report contains an overview of the global gold mining industry together with the key factors affecting the industry and demand and supply for the commodity. It also provides information about global gold reserves, the historic and forecast data on gold production, prices and major companies in Gold mining sector, gold consumption, and the competitive landscape.

Gold mining is a global business with operations on every continent, except Antarctica, and mines of widely varying types and scale. South Africa produced roughly two thirds of all production with an annual mine output of around 1,000 tones. This has since diminished to 168 tones (in 2015) and the country is now ranked sixth amongst gold producing countries. The gold supply has become less geographically concentrated and therefore, overall, more stable. Since, a greater number of countries have emerged as substantial gold producers over recent decades.

Asia Pacific is the leading producer as well as consumer of gold with major consumption in South East Asian countries. High growth in India, China and South East Asian countries coupled with rising disposable income of the general population is the major driver for the growth of the market, in the region. 

Global gold reserves were 56,700 tones (t) as of January 2016, with Australia accounting for the largest share with 9,100t or 16% of the total, followed by Russia with 8,000t (14.1%), South Africa with 6,000t (10.6%), the US and Indonesia each with 3,000t (5.3%), Peru with 2,800t (4.9%), Brazil with 2,400t (4.2%) and the remainder by other countries. Gold reserves in Russia are mostly located in the Far East and Krasnoyarsk districts. The Witwatersrand basin remains the largest gold deposit basin in South Africa.

Gold is a precious metal, mainly used as jewellery and for investment purposes globally. Gold is considered as a safest bet for investment in times of high inflation with currency fluctuations.

Rising prices are expected to be a major factor driving the global gold market as more and more consumers are purchasing gold as a mean of long terms investments. Further, political instability and confidence over bullion, as a secure investment with high returns, aid in generating demand for gold.  The diverse demand for gold is for, jewellery, technology, and by central banks and investors.

Further, industrial demand for gold especially in the electronics industry is expected to boost market growth in Asia Pacific. China is leading the market and is projected to increase its consumption to aid its high growth. The Chinese middle class urban population with rising disposable income has also increased investment in bullion as a quickly liquefiable asset substituting savings in the banks. Europe is the fastest growing region in terms of gold production with major production from Russia. Leading gold producing countries in the world include Australia, Brazil, Canada, Indonesia, Mexico, Peru, Papua New Guinea, Russia, the US, and Uzbekistan. 

Global gold supply is a mixture of mined gold, scrap recovery and central-bank supply. More than half of gold supply worldwide comes from mined gold. China is the largest producer of mined gold. It overtook South Africa in terms of gold production volume in 2007.  The annual total supply of gold has averaged around 4,000t over the last 10 years. Where, total mine supply- which is the sum of mine production and net producer hedging, accounts for two thirds of total supply. Recycled gold accounts for the remaining third.

The sources of mine production have become as geographically diverse as gold demand. China was the largest producer in the world in 2015, accounting for around 14 per cent of total production. Asia is as a whole produces 23 per cent of all newly-mined gold. Central and south America produces around 17 per cent of the total, with North America supplying around 16 per cent. Around 19 per cent of production comes from Africa and 14 per cent from the CIS region.

The gold mining industry faces few challenges, including cost pressures, lack of substantial discoveries and a reduced project pipeline. This is likely to see production revert to its longer term levels. Thus, the concept of ‘Responsible Mining’ must be considered. Where, when produced in conformance to high social, environmental and safety standards, gold provides employment opportunities, improved infrastructure and tax revenues. It can also drive foreign direct investment and generate foreign exchange 

Some of the key players in the gold market include: 

·         Barrick Gold Corporation

·         Newmont Mining Corporation

·         AngloGold Ashanti Ltd

·         Goldcorp Inc.

·         Kinross Gold Corporation

·         Newcrest Mining Ltd

·         Gold Fields Ltd

·         Polyus Gold International Ltd

·         Agnico Eagle Mines Ltd

Global Gold mining market

Global Iron Ore Market Research

Mining sector Future Outlook

Barrick Gold Corporation Market Share

Newmont Mining Corporation Market Share

China Gold Mining Market forecast

Global Gold Reserves

To know more on coverage, click on the link below:

https://www.kenresearch.com/metal-mining-and-chemicals/mining/global-gold-mining-2020/34714-101.html

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Global Iron Ore Mining to 2020

Ken Research announced its latest publication on, “Global Iron Ore Cost Curve”, offer insights on the changing trends and potential opportunities within the Global Iron Ore Industry. The publication includes an insightful analysis of iron ore categories, Global iron ore industry structure, production cost: mining, processing, admin, freight and royalties, competitive landscape and performance assessment of iron ore companies. The analysis of the aforementioned trends has been done for 70 iron ore operations, across 30 companies, ranging from the large producers , such as Rio Tinto, Vale and BHP Billiton, to one-mine companies, such as BC Iron, and  large steel producers, such as Arcelor Mittal.

Overview of Global Iron Ore Industry

Iron is most important commodity used across the globe. Increasing infrastructure development and industrialization has accelerated the demand for iron. Hence, the demand for iron is increasing at a high pace across the globe. The amount of extraction and usage can be directly correlated with any country’s GDP. Iron is widely used in structural engineering application, maritime purpose, automobiles and general industrial application. Hence, with increasing GDP in every country, the demand for iron ore is expected to grow driving the global mining industry.

Looking from the production perspective, China is one of the largest producer of iron ore but also it is largest importer as well, reason being inferior quality of iron ore produced there(17-20% FE content as compared to average 62% FE content worldwide) and the economic boom that resulted in an unprecedented rise in demand for iron ore. After china japan is second largest producer, followed by USA and Germany.Over the past decade iron ore prices have hit record highs due to China’s rapid development and growth. As China slows its growth to more sustainable levels, the unprecedented demand for iron ore and steel is slowing but still remains strong.

Apart from prices, cost of iron ore production plays a vital role in the strategic business decisions of the iron ore producers especially miners. Going by the country level data, Australia is the lowest-cost producer of iron ore, significantly below the global average due to its abundant high-grade hematite ores (iron content of 62.5% and above) and extensive infrastructure facilities.While Brazil has abundant hematite deposits,Australian producers hold a cost advantage over their Brazilian counterparts due to their geographic proximity to China. Due to infrastructural constraints in India and deteriorating ore grades in China, both countries are positioned near the top of the iron ore cost curve. West Africa especially Guinea, Liberia and Sierra, is poised to become the new iron ore producers as extensive efforts are being made to discover some of the world-class deposits in the region.

Global Iron Ore Cost Curve, March 2016: Key Findings

The Global Iron Ore Cost Curve for March, 2016 quarter reports the current updated cash cost positions of iron ore producers. As per the report:

·         Further reduction in cost of iron ore production have been achieved by the producers as a result of lower average oil prices in the quarter and shut down of high cost mines.

·         The Australian Big 3, Rio Tinto, BHP Billiton and FMG, has safely maintained their largest producer position in 2015. This was followed by the Mesa operations run by Rio Tinto. These operations are all in the Pilbara region of Western Australia. As Hematite operations, they produce predominately lumps and fines, both of which are direct shipping ores (DSO) which lowers their processing costs.

·         Also, all-in cash breakeven for the seaborne iron ore producers is below USD63/dmt cfr.Compared to previous 6 months in 2015, global iron ore producers have managed to lower their breakeven costs by up to USD15/t. The breakeven range for the producers is now USD27-63/Mt cfr.

·         The iron ore supply has been below expected level, hence March, 2016 has been a weak quarter. Bad weather in Australia and Brazil, among others, obstructed the growth of iron ore production.

Major Players in the Global Iron Ore Industry

Global iron ore industry is a huge with market players ranging from large producers, such as Rio Tinto, Vale and BHP Billiton, to one-mine companies, such as BC Iron, and large steel producers, such as Arcelor Mittal. Some of the major iron ore producers include: BHP Billiton, Labrador Iron Ore Royalty Corporation, Mitsubishi Corporation, Sinosteel Corporation, Hancock Prospecting Pty Limited, Rio Tinto, Sumitomo Corporation, Mitsui & Co, Nippon Steel & Sumitomo Metal Corporation, Vale, Cliffs Natural Resource Inc, FMG, Mount Gibson, Arrium, Ferrexpo, Vedanta, African Rainbow Minerals, Assore Limited, Arcelor Mittal, BC Iron Limited, Atlas Iron, Cliffs Natural Resources, CAP SA, Anglo American, USSC, Grange Resources, Stemcore Holdings Limited, Ternium SA, RZR Ljubija a.d. Prijedor.

However the dominant three iron ore producers are Rio Tinto, Vale and BHP Billiton, accounting not only for largest share of world production but also have the lowest-cost operations, reason being abundant high grade mineral ores, efficient infrastructure and close proximity to China.

Prospects for Global Iron Ore Industry: Production Cost Perspective

March, 2016 quarter registered global iron ore supply below the expected level. As compared to 2015, even the largest global producers Rio Tinto, Vale, BHP Billiton and FMG posted lower iron ore production. However, with the iron ore pricesgetting back above USD70/dmt cfr due restocking, better quality steel spreads and reduced iron ore supply, we expect iron ore production to increase as the major producers increase their production to capacity level. Rio Tinto, Vale and BHP Billiton, along with their low cost operations, will continue to maintain their dominant position in the iron ore industry.Low strip ratios will ensure most operations have low mining costs per tonne.

Looking at key iron ore producing countries, Australia, the global cost leader, will maintain its position, while India and China, will remain near the top of the iron cost curve. One major expectation for the global iron ore industry is the iron ore boom in West Africa and expansion of African iron ore industry, with Guinea expected to become the one of the largest global exporter of iron ore and largest producer in African region by 2017.The region has world class iron ore deposits that are being explored substantially.

In coming years, challenges such as rising cost due to tax hikes and labour cost increases, declining ore grades in China, infrastructural constraints in India etc. may limit the cost reduction capacity of iron ore producers and hence growth of global iron ore industry, according to Ken Research.

Key Topics Covered in the Report

·         Detailed analysis of the Global industry structure of iron ore mines

·         Current trends, Drivers & Challenges in the Global iron ore industry

·         Global, company level and country level production cost analysis& iron ore cost curve

·         Competitive landscape in the Global iron ore industry

·         Individual & Comparative assessment of major international & regional  iron ore companies

 To know more on coverage, click on the link below:

https://www.kenresearch.com/metal-mining-and-chemicals/mining/global-iron-ore-cost-curve/33377-101.html

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