Canadian miners minimized disruption initially of the Covid-19 pandemic by performing rapidly and decisively, leaving many in a superb place to learn from rising commodities costs, notably gold, copper and iron ore, in response to a brand new PwC report.
Over the previous 18 months, corporations streamlined communications, adjusted on-site work schedules to restrict potential publicity, launched new protecting gear, directed technical and help employees to work at home and collaborated with trade associations to share data to higher defend folks from the virus. In addition they supported native communities by way of donations and rapid-testing packages.
This agility helped Canadian miners profit from metals costs that started to rise final yr and have usually remained sturdy in 2021, the PwC report shows. Canada’s mining sector has continued to thrive after the preliminary uncertainty of the pandemic gave solution to resumed operations and a restoration for commodity costs that has delivered features to buyers all through a lot of 2020 and into 2021, PWC says.
Gold hit file highs above US$2,000 per ounce in August 2020 earlier than settling down at a mean US$1,771 per oz. for the yr, a considerable improve from the US$1,394 per oz. it averaged in 2019. The spot value for the valuable metallic reached the same stage final month — US$1,756.95 per ounce.
This yr has already seen some key mergers within the sector, together with the current US$10.7 billion tie-up between gold miners Agnico Eagle Mines and Kirkland Lake Gold.
The standout performer amongst commodities has been copper, a key ingredient within the ongoing shift to renewable vitality infrastructure. Costs for the metallic averaged US$2.81 a lb. final yr, in comparison with US$2.72 per lb. in 2019, and have continued their upward trajectory this yr, hitting a file excessive in Could.
The spot value for the commercial metallic hit US$4.06 a lb. within the final week of September and the PwC analysts count on the sturdy pricing surroundings for copper to proceed amid excessive demand for the metallic.
“Canadian miners have constructed on their successes in navigating the Covid-19 pandemic to proceed rising in 2021,” says Kevin Chan, PwC Canada’s Nationwide Mining Chief. “With money readily available and situations wanting favorable for additional progress, now could be the time to behave boldly in embracing the subsequent stage of change and transformation.”
The authors of the report spotlight 4 points that ought to be on the agendas of Canadian miners within the yr to return.
One is the best way to speed up the adoption of transformative applied sciences, corresponding to synthetic intelligence, knowledge analytics and cloud computing.
The second factor pertains to taking part in a key function within the shift to a low-carbon financial system and incorporate environmental, social and governance (ESG) rules into their methods.
Mining corporations must also think about the best way to create worth in a market that’s ripe for consolidation, as current mergers together with Fortuna Silver – Roxgold, Yamana Gold – Monarch, Endeavour Mining – Teranga, Equinox Gold – Premier, and Agnico Eagles – TMAC Resources have confirmed.
Lastly, the report calls on Canadian miners to judge the potential for geopolitical modifications amid a fancy enterprise panorama that’s creating each challenges and new alternatives for the trade.