Commodity "super cycle" demand big African mining industry is digging deeper

Diamonds are not long. Ask John J. Teeling, the chief executive of the African Diamond Company (African Diamonds), an exploration agency based in Dublin.　　In a recent symposium at the Wharton Global Alumni Forum, held in Cape Town, South Africa (Wharton Global Alumni Forum), the Spirit said South Africa's mineral deposits "are drying up" despite its glorious past as a leader in gold and diamond products. Now, the company is jointly developing a large mineral deposit with South African diamond giant de Beers in Botswana, saying that since 1983, of the 12 mining projects he has started, 7 projects have been in Africa-including in Mozambique, Zimbabwe and Sierra Leone- But there is no project in South Africa. "From a geological standpoint, wherever there is a chance, we go." "he said. "If there is no geological condition, you cannot find mineral deposits." "South Africa has been exploiting diamonds since 1867 and mining gold since 1887, and with the passage of time, South Africa's mineral resources have dried up, while rising stars such as South Africa's neighbour, Botswana, have become the center of attention in the mining industry." Globally, competition has become increasingly fierce: a century after the first throne of gold production, South Africa's position was replaced by China in 2007. "In Africa, the great discoveries of the future will not occur in South Africa.　　"said the spirit. One participant, who disagreed with the future of the South African mining industry, said the new technology could prolong the lifespan of old mines. Indeed, it is agreed that emerging markets such as China and India are accelerating into a long-term commodity "super cycle" (Super Cycle), while African countries learn how to deal with the so-called "resource curse" (Resource Curse) ("Resource Curse" is a classic hypothesis in economics that rich natural resources may be a curse rather than a blessing for economic development. Those countries or regions with rich natural resources, because of the excessive dependence on natural resources, their political and economic system easily lose the impetus of change, innovation, locked in some kind of not free, underdeveloped state.　　Skills, if they acquire the ability to acquire the value of rich natural resources, the mining industry will continue to play a major role in the economy of Africa as a whole. Like any industry that has lasted more than a century, South Africa's mining industry has its own problems. Turing implied that the historical problem of obtaining mining licences-"mining permits for several years"-and some recent reform measures on mining rights, is now under government control. (in the former regime, mining rights are a mixed form of public ownership and private ownership.) Earlier this year, the industry was forced out of business because of a sudden power outage, due to the country's power system overwhelmed--kindIn the era of family isolation, urban development has brought huge demand for electricity. (Eskom, the state-owned power supplier Escam Power, says it will solve the power problem by building new coal-fired power plants and nuclear plants, a process that takes at least 5-7 years. Despite the difficulties, the mining industry still maintains its first industry position in South Africa. To ease the atmosphere of the symposium, David Reibstein, a marketing professor at the Wharton School of Business, says the mining industry is the country's biggest "employer": up to 500,000 people are directly employed in the mining industry, and another 400,000 are indirectly employed in the industry through David Rubinstein services related to mining. South Africa's mines produced nearly 89% of global production, manganese production accounted for 80% of global production, and chromium production accounted for 73% of global production, although its status has recently declined, but South Africa's gold production still accounts for 43% of global gold production. 2006, South Africa's mining industry contribution to South Africa's GNP amounted to 7%.　　If combined with output from other industries such as services and electricity production, the ratio would rise to 18.4% per cent. Davinoco David Noko, managing director of the De Beers Joint mining company headquartered in Johannesburg, said he did not agree with the idea that the Golden age of South Africa's mining industry had gone away. As a well-trained engineer, Nocco that technology is the key to acquiring the value of the remaining minerals in mines that seem to have been mined out of resources. When he joined De Beers in 2002, he found that the company was "clinging" to traditional and old systems. "To change, there is a chance. He was later convinced that the use of advanced prospecting techniques in mines that had no productive capacity would bring about the "equivalent of developing a new mine" income. For De Beers, the strategy has been successful.　　Nocco talks about the company's mines in the Northern Cape (Northern Cape) in the Kimberley City (Kimberley), where mines were previously closed and are now a major source of corporate diamonds. He agreed that technology did play an important role in the future of the mining industry, saying that the second and third largest gold mines in the world were discovered in the 1990s by virtue of this technique. "They believe that since the introduction of new technology, mineral exploration will start from zero every 20 years." "he said. "But all the technology in the world can't make the reserves bigger." Resources are limited, and that is the greatest challenge we face, and new technologies cannot change that reality. "Technical equipment is expensive and cannot be effective in certain environments," adds Ling. He joked that he had 12 sets of state-of-the-art mining equipment that could be sold to anyone interested in them. "They look great, but I don't know what they can do for me." "South African Mining Federation (Chamber of Mines South Africa) (also translated as "South African Mining Association") was founded in 1887 as a private enterprise representative organization, the federation's chief economist, Rogerbackstedt (Roger Baxter), said that any calculation of the future potential of the South African mining industry Depends on the kind of minerals people are talking about. For example, in the past 20 years, South Africa's mines have produced 50,000 tonnes of gold, more than half of the industry's history of gold mining, he said.　　At the same time, diamonds still bring us nearly 10 billion dollars a year, and in addition, the country is the world's leading platinum exporter and the third largest exporter of boiler coal. Gareshachl (Gareth Huckle) agreed that Haker is the senior vice president and general manager of the South African Sun Mining Company (Africa at Sun Mining), a branch of the Indian Private Holdings solar Group (sun groups) in South Africa, where he talked about , gold and platinum have always been attractive to investors. But on other issues-for example, the mining Charter (Mining Charter), where all mining permits are owned by the government and some of the issues surrounding concessions-he shares the same insights with the spirit, for investors like the Sun Group, These problems have made South Africa a less desirable option. In 2001, the regulations on mining licences were introduced as a channel to open the industry to poor South Africans in the framework of the Black Economic empowerment, the ultimate goal of which was to transfer 50% per cent of the industry's equity to black Africans. The introduction of royalties on export Minerals has also alarmed mining companies operating in the country: A new bill was introduced in 2003, which stipulates that diamonds are 8% of total revenue. This ratio was revised to 3.7% per cent in December 2007, and Platinum's concession cost was set at 2.7%, a level comparable to that imposed by other countries. The bill is expected to be implemented early in 2009.　　' From the standpoint of the industry, the policy environment has improved, ' said Baxter. Hacker, however, said the arena for mining investment was global and fiercely competitive. The question for investors is "where are we most likely to find something attractive?" Ultimately, this is a question of making choices around the world.　　The participants in the [page] "Structural change" Symposium agreed that for South Africa and other countries with rich mineral resources, rising commodity prices and explosive growth in markets such as China and India mean that investment in the mining industry will continue and that the mining industry will remain strong. "The ' super cycle ' seems to be good for us," said Ling. "For example, China's dramatic growth in demand for cars alone, like zinc--for galvanizing--this kind of mineral production needs to be increased by one fold. So what is the status of the diamond? Not long ago, "650 million of Chinese women won't say: ' If you love Me, give me an engagement ring." ' But now they're going to ask for that. So now, 650 million men need to pay for it. "In the next 15 to 20, China will have an urbanizing population of 500 million." Baxter added. "To this end, we need to build 50 to 70 first-tier cities, two-tier cities and three-tier cities." "The unprecedented increase in demand for raw materials suggests that the current super cycle is not just an extended commodity demand cycle, but rather a" structural change based on the nature of growth. "When asked whether the current economic crisis in the US and other markets would have an impact on mining," said Mr Ling, the economic crisis could lead to an industry recession, but the impact is short-lived. "In the long run, the (foreground) is bright. "Baxter talked about whether the price of oil is $70 a barrel or $200 a barrel" will certainly have a significant impact on the commodity cycle, because 30% of the cost of the mining industry is related to fuel and raw materials. While demand for diamonds in the United States has fallen, the global demand will remain stable for a long time, and the increase in the cost of fuel and other raw materials needed for mining will constrain capacity, he added. "There were times when I thought that my diamond was better in the ground than in the market because I hadn't seen the price I wanted to see," he said. "For Novartis and De Beers, the choice to keep the diamonds under the ground is just one option," he said.　　Other countries are less fortunate, and they are sitting on huge resources, but they cannot maximize the value of their resources because of the lack of infrastructure, legal systems and technical capabilities. The famous "resource curse" theory holds that countries susceptible to temptation will be exploited arbitrarily by companies and foreign governments that come in for mining but do not leave much value. South Africa has a mining licensing system and a licensing system for mining rights fees, contrary to the case of the "resource curse" countries.　　In addition, the Government of South Africa has taken measures to ensure that the "mineral processing" (beneficiation) process of minerals mined in the country-that is, procedures to increase mineral value, such as smelting, cutting and polishing-is properly implemented. The "Elephant Country" is on the other end of the mineral-rich country group, the Democratic Republic of the Congo (Democratic Republic of the Congo, DRC), Hacker said that, as far as the amount of mineral resources has not been exploited, Congo " And Russia is the most promising country on the planet. However, unlike in Russia, where the complexity of the process of acquiring mineral value stems mainly from political reasons, the risk of mining in the Congo is dominated by politically unstable and other risk factors. She added: "WeIt's called the ' Elephant Country '. "There is no infrastructure, and the cost of development is very high." It now seems that its potential has not yet become a reality. "Baxter talked about whether minerals are" poison or growth ", largely dependent on government leadership, saying that Botswana has a successful story on the basis of financial and regulatory transparency. Today, once very poor Botswana has become a middle-income country, thanks to its mining industry, where, since independence in 1966, Botswana's per capita income growth rate has remained at 6% to 9%, so Botswana is known as the "Miracle of Africa". He also believes that Botswana is indeed a good example of success, but he owes his country's success to the fact that, unlike the Democratic Republic of the Congo and other African countries, Botswana is a tribe that uses one language. I am not sure whether Africa has prepared for democracy in just 50 years after the end of the colonial era. "In addition, it is doubtful whether institutions such as their own companies should play a role in the government's reform process," he said. "You can't tell a country what their leadership should look like." Who are you standing on the same side with? People should change the government, not the mining companies. "No matter what philosophy the companies pursue, there is no doubt that global competition is changing the rules of the African mining industry and changing the pattern of interest," he said. Hacker the presence of Chinese mining companies in Africa is becoming increasingly apparent, and they tend to operate in a way that differs from those of companies from democracies. "When Chinese people invest, they bring in a lot of their own resources to exploit mineral resources effectively." "Unlike Western companies, Chinese companies are not aiming to recoup their investment, but to fill a" strategic gap, "he added. "They are willing to pay more to fuel the growth engine." "What is more worth considering is the fact that China has injected 17 billion of billions of dollars into the Democratic Republic of the Congo to get preferential access to specific mineral resources," he said. "What company can compete with it?" ...... We (China) are dinosaurs. "said the spirit. "You should let the Chinese, the Indians and the Russians speak here," he said. ”