By Courtney Pearson
AUSTRALIAN mining companies should focus on the ongoing productivity challenge; innovation, mergers and acquisitions; and safety issues in a commodity price downturn that has no clear cycle, according to Deloitte.
The Tracking the trends 2016 report stated that miners would need to ask the tough questions, show initiative in innovation and take a new approach to traditional operating assumptions, in order to pioneer the future of mining.
Furthermore, the report showed China’s influence on the global economy was likely to spur miners to form a greater understanding of the country’s market trends and develop plans relative to its offshore investment initiatives.
“The operating environment remains volatile and complex and the imperative remains to innovate, adapt, manage costs and drive sustainable operational excellence and productivity improvements, while also driving and maintaining cultural change, in the face of these challenges and around workplace safety and health,” Deloitte Australia national mining leader West Coast Nicki Ivory said.
“Innovation and operational excellence will remain critical, and miners need to be more open to adopting lessons and ideas from other sectors, such as collaborative ecosystems, digital workforce engagement, enhanced asset management and 3D printing.”
The report found that cutting costs would be one of the biggest issues facing miners, warning companies to not become complacent about cost control.
Additionally, miners would need to prepare to change their positioning in the global energy mix as renewables threaten the future of thermal coal.
Stakeholder engagement, attracting capital, tax challenges, deal values and volumes, and corporate and personal welfare were also flagged as big issues for the coming year.
Gold was named as the biggest commodity play for mid-tier miners with producing assets, and copper and nickel would likely pick up once producers moved past nervousness about falling prices, Mrs Ivory said.