OTTAWA – The long term outlook is positive, says the Mining Association of Canada, but this year will be a challenging one. MAC has made the forecast as it releases its annual look at the Canadian mining industry, Mining Facts and Figures 2014.
The Facts and Figures report draws on the most recent data available from the federal government (mostly 2013), and reveals how the mining industry contributes to the Canadian economy. Canada's miners contributed $54.0 billion to the national GDP in 2013 up from $52.6 billion in 2012. Mineral exports accounted for 19.5% of the Canadian total in 2013, down slightly from 20.4% in 2012.
MAC pointed out that mining employment numbers remain strong. The industry employed more than 380,000 people in the industry in 2013. Mining, smelting and refining jobs continue to be some of the best paying in the country with average earnings that top $110,000 per year.
The effect of falling commodity prices can be seen in shrinking exploration spending. In 2013 exploration spending in this country was only $2.3 billion, a drop of 41% from the year before. Exploration spending in 2014 will slip even further, to $2.1 billion.
"The cyclical nature of our industry means that mining companies are no strangers to ups and downs in the global market. In the current economic environment, the industry is focused on reducing costs, improving productivity and preparing for the next upswing," said Pierre Gratton, MAC's president and CEO. "We are confident about the future demand for our products and the Canadian mining industry is focusing on getting in shape now to seize the growth opportunities ahead of it."
MAC also identified the top three issues for the Canadian mining industry in 2015.
- State of the global mining economy: Recent uncertainty over the short term global economic outlook, particularly the softening of China's growth, caused commodity prices to decline in 2014 and volatility is expected to persist in the year ahead. Despite challenges, the prevailing view is that the industry's economic prospects over the long term remain strong, especially as the middle classes of China, India and other emerging nations continue to grow
- Lack of critical infrastructure: Mines require infrastructure like roads, ports, railways and power grids to operate, which are often not available in remote and northern regions of Canada. Immense opportunity for mining development lies in Canada's northern regions, and would provide significant socio-economic benefits to northern communities.
- Complex regulatory environment: Recent years have seen significant changes to the regulatory regime for mining in Canada. The Canadian Environmental Assessment Act, the Fisheries Act and the Navigation Protection Act were amended in 2012, and a review of the Metal Mining Effluent Regulations is still ongoing. As regulators transition to the new regulatory regime, it is crucial that mining projects are reviewed once, and that various federal requirements, along with aboriginal and public considerations, are integrated into a unified, robust and timely process with meaningful consultation. This will ensure projects are reviewed effectively, yet efficiently to avoid costly and unnecessary delays due to overlap with other provincial reviews.
Learn more about the Mining Association of Canada and what it does for its members at Mining.ca.
Comments