Digitalization, climate trends buoy outlook for German mining machinery

The mining machinery industry in Germany expects a decline in sales of 10-15% in 2020. Nevertheless, the industry is optimistic about the future, because only state-of-the-art mining technology will be able to ensure the raw materials needed for climate protection and digitization.

The importance of the mining industry in this context was emphasized by the chairman of the VDMA Mining Association, Dr. Michael Schulte Strathaus, during the annual press conference in Essen. Due to the pandemic, no one is able to predict how 2021 will develop, but Schulte Strathaus is sure that incoming orders and sales will develop positively in the future.

“We ensure that raw materials can be mined and processed. Mining equipment is becoming increasingly environmentally friendly and is making its contribution to climate targets, for example through alternative drives and lower energy consumption in mines,” he said in a release.

With the expected 10-15% decline this year, sales should stabilize at between 4 and 4.5 billion euros.

The EU countries, the U.S., Russia, and China remain among Germany's largest export markets. Australia surprised everyone this year and made it to second place among the individual markets, ahead of China and Russia. With an export share of 96%, manufacturers in Germany are dependent on foreign business.

Following a very successful 2019 with exports of around 97 million euros, deliveries to Australia fell to 68.8 million euros in the first eight months of this year. Schulte Strathaus was confident that Australian customers would again be more interested in mining technology from Germany from 2021 onwards, as the reluctance to establish new supplier relationships was clearly due to the current corona crisis.

Russia is currently a very difficult market due to sanctions, political disagreements, and the weak ruble. Travel restrictions and the uncertainty that deliveries from Germany could be stopped at any time make business relations too risky for Russian companies.

In China, coal mining was far ahead of the Chinese mining industry. While the country is recovering from the pandemic, the mining sector generated sales of around 309 billion euros and a profit of around 30 billion euros in the first eight months of the current year. Manufacturers from Germany were unable to benefit from this. By August, exports had only reached 67.7 million euros, a drop of 45%. Schulte Strathaus nevertheless sees good chances for a positive development, because China is banking on digitization and unmanned operation in the mines.

In addition to the technology, social benefits are increasingly becoming the focus of attention for manufacturers of mining machinery. "With our machines, we guarantee a climate-friendly and secure supply of high-tech raw materials, because without them there can be no energy transition," Schulte Strathaus concluded.

For more information, visit www.Mining.VDMA.org.