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What does the future hold for mining?

Australia's mining industry is sure to see changes in the coming years.  "

From using minerals to colour rocks in Aboriginal art to contributing 9.3 per cent to the annual value of Australia, the mining industry has come a long way.

According to PwC's recently released Mine 2016 report, the end of 2015 marked an overall low for the market, with this year hoped to be a turning point towards more sustained growth. But how has the industry become what it is today and how does the current landscape actually look?

Australia gained its global reputation for mining during the gold rush of the 1850s.

Where does mining come from?

As coal was discovered merely 10 years after the first settlement arrived in 1788, Geoscience Australia documents that Australia has seen minerals provide economic growth since its early days. Initially providing fuel for cooking and transport, the discovery of lead and copper around 1841 led to rapid technology developments. This boosted the then-emerging industry to overtake exports of Australian wool and wheat by 1850. 

The start of the gold  rush in the 1850s stepped the game up yet again, earning Australia its reputation in mining and moving the country into new growth areas within machinery development. The Australian Bureau of Statistics (ABS) reports the first discoveries of gold in 1823 led to immense growth of the country's population. Something emphasised by Australia's Mining History Association reporting the country produced a whopping 40 per cent of the world's gold.

Further discoveries of metals such as tin, iron ore and zinc in the 1870s helped establish Australia's first major mines in Queensland, New South Wales, Western Australia and South Australia. The continued boom of the industry came to a dramatic slow down when World War I severely affected metal prices. The ABS recorded a drop in exports from $15.3 million to $7.6 million, forcing many mines to close.

Only slowly did mining and smelting recommence after the discovery of Mount Isla's lead-zinc-copper deposit, which started to be mined around World War II.   

Australia's mining industry became  famous during the Goldrush. Australia's mining industry became famous during the gold rush.

What is the current situation?

Australia has continued its success story and today, as suggested by Geoscience Australia as well as the ABS, counts as one of the world's top providers for mineral resources with over 400 mines across the nation. PwC's report reflects this dominance within mining, as Australia sits in the top two spots of the industry's 40 biggest players.

The report also shows that there is a relatively even split between emerging and traditional companies, with the Chinese starting to take a bigger share of the overall market. However, with less free cash available demand in bulk commodities, expansions and investments are lower. This in effect slowed the shift and growth of the industry and made 2015 not the best of years for mining.

On a positive note, overall reduction in absolute debt has entailed a stronger focus on alternative financing and the acceleration of some disposal programs, making 2016 a potential turning point for the industry according to PwC. 

The future holds a lot of changes for the mining industry.The future holds a lot of changes for the mining industry.

What is in store for the future?

Despite the obvious challenges of a slower market PwC suggests a positive long-term outlook for the mining industry, as it is within companies' capabilities to adapt to current shifts.

Adding to this, research by Deloitte noted looking at other industries for inspiration regarding structural and cultural shifts. Big players in the market have already started to, and will be required to continue, restructuring their chain of commands and hierarchies to accommodate for changing environments. 

Accordingly, Deloitte further points towards the importance of communicating the same vision and message across all stakeholders within each company as well as continued investment in new technologies and innovative ideas to bring the industry to new heights in the future.

The landscape of the mining industry is bound to shift towards innovation around energy solutions.

As the mining industry's attention shifts to more efficient and sustainable long-term solutions along the supply chain, successful productivity will be determined by the collaboration of partners along the supply chain. Leading from this, the optimisation of relationships and technologies can enable companies to utilise data captured to gain knowledge, which can be used to adapt.

Undoubtedly, according to Mine 2016, the landscape of the mining industry is bound to shift towards innovation around the energy solutions, opening up new growth opportunities within the industry.

From its initial boom through to the crisis surrounding the World Wars, the mining industry has been through ups and downs and overcome many a challenge. Even though the past year might not have been the strongest for growth, there still is a positive outlook for the industry in the long run, as it adapts to environmental shifts.

Interconnect Systems has a comprehensive background in aerospace and defence engineering, being an industry leader for more than 20 years. It provides electrical interconnect products and solutions, including cable and wire harness manufacture. For more information on the best backshells and cable harness solutions, contact Interconnect Systems today on 1800 812 214 FREE.

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