Sept/Oct 2008

Supply Side

The challenge of statistics and forecasting for mining equipment sales

By J. Baird

At CAMESE, we often receive enquiries for statistics that define the size of markets by country, product or service. All marketers want such statistics to plan growth strategies and justify marketing plans and expenses.

And yet, it is difficult to find useful, product- or service-specific statistics for sales to the mining industry, either in Canada or worldwide. Some information for Canada is available at http://www.ic.gc.ca/epic/site/tdo-dcd.nsf/en/Home where you can search for data by North American Industry Classification System (NAICS) codes. Part of the problem is that information that one would like for the mining industry is bound up with that for other sectors like construction or oil and gas. Such groupings make the data difficult to use by marketers interested in a specific product.

For example, NAICS code 333130 covers “mining and oil and gas field machinery manufacturing.” A search of this code for Canadian imports from all countries shows that they rose from $698 million in 2003 to about $1.236 billion in 2007. Manufacturing shipments (the value of goods and services produced in Canada) for the same code rose from $728 million in 2003 to $1.893 billion in 2007.

Another approach to data for the Canadian market is information kept by Natural Resources Canada in their Minerals Yearbook. The chapter on “Mineral Exploration, Deposit Appraisal and Mine Complex Development Activity” goes into considerable detail about capital expenditure by mining companies. For this information, visit http://www.nrcan.gc.ca/ms/cmy/pref_e.htm.

Yet another reference is the Canadian Mining Sourcebook. Published annually, the sourcebook is a highly detailed and reliable report on the supplies, equipment and mining methods used by active mines and mineral processing plants in Canada. For your copy, go to www.miningsourcebook.com.

World demand for mining equipment is expected to grow by 5.9 per cent annually through 2011, according to a recent report entitled “World Mining Equipment” issued by The Freedonia Group Inc. Global demand for mined commodities will push the annual spending on mining equipment to US$33.6 billion by 2011.

According to Freedonia, production of heavy mining equipment is dominated by the United States, Western Europe and Japan. Such countries have a long history and extensive expertise in the development of capital equipment industries of all types, many of which have leveraged this expertise to produce mining machinery. China is emerging as a major producer, due in large part to the needs of its own growing industry, but also to becoming a net exporter, shipping products to both developing nations and mature markets such as the United States.

Freedonia says that China is increasing its production of iron ore, bauxite and coal, India is expanding coal production and Australia’s production of bauxite and iron ore is growing. These trends are driving the demand for heavy equipment in the Asia-Pacific markets. Africa will post healthy gains, benefiting from rising demand for precious metals and copper. Growth in demand for mining equipment in Latin America will reflect increased investment in nations like Brazil, Peru and Chile. Eastern Europe will also post gains, benefiting from gains in the large Russian market. Growth in North America will lag behind the industry average, reflecting the maturity of these markets.

The Freedonia report presents historical demand data as well as forecasts for six regions and 33 countries. It examines market environment factors, company market share data and profiles 25 global industry competitors. For more information, visit http://www.fredoniagroup.com/world-mining-equipment.html.


Jon Baird
Jon Baird, managing director of CAMESE and the immediate past president of PDAC, is interested in collective approaches to enhancing the Canadian brand in the world of mining.

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