27 November 2014

Hidden Ninjas in Mining

Hidden Ninjas in Mining Hidden Ninjas in Mining Hidden Ninjas in Mining Hidden Ninjas in Mining

Hidden Ninjas in Mining

The mining industry has seen a lot of changes in direction over the past few years…. Many feel like we're fighting against unseen ninjas. You know the kind, the hidden ones that are right in front of you, the:

- Red tape ninja
- Bureaucracy ninja
- Commodity price volatility ninja
- Global economic uncertainty ninja
- Wind direction ninja
- Government policies / taxes / royalties ninja
- Rising operational costs - high costs of labour and
   compliance ninja
- Non-mining professional heads of businesses making
   ultimate technical decisions ninja
- Strengthening USD ninja
- Strong AUD ninja

And all these Ninjas are coming at the mining industry from different directions, while the battle to raise funds continues and financing of projects in general is hard to come by as Investors turn away from mining. At the same time China's economy is slowing but by global standards is strong! West & Central China has yet to experience large scale mass migration / modernization / urbanisation - hidden ninja ready to go ballistic? And India is on the verge of doing similar…. And let's not forget the Ebola "pandemic" that has killed <5,000………..is that technically a "pandemic"? I digress……

So what is all this Ninja activity leading to?......

- Mass technical & operational redundancies since 2012
   and many leaving the industry forever.
- Exploration budgets cut and/or non-existent
- Companies taking a serious look at operational
   efficiencies, innovation & cost reducing technologies -
   good stuff really.
- Scrapping of the carbon & MRRT - will it lead to
   increased market confidence?
- M&A activity is leading to new and exciting prospects
   and projects.

So what is the end result?

Who knows what's really going to happen?

Who knows how to accurately predict future demands?

World demand promises to increase dramatically in the coming years - fact.

What will the mining and exploration industry look like this time next year?

What variable scenarios do you need to build into your strategic planning?

In the words of English poet Coleridge: "If men could learn from history, what lessons it might teach us."

When could the hidden ninja jump out from behind the waste dump and cut you off at the knee-caps or could the ninja grant you amnesty?