BDO unveils three trends for Australia's mining industry
Australia’s mining market is set for change. Changing expectations from clients and mining stakeholders is igniting a number of trends, including phasing out of diesel machinery, growth in domestic beneficiation capacity, and the crowdsourcing of project ideas.
Accounting and consulting firm BDO closely monitors developments in mining across some of the world’s leading mining markets, which include the US, Canada, South Africa, the UK and Australia. Two years ago, the firm released a set of predictions for the mining industry, many of which appear to be coming true alongside other unforeseen trends.
In its latest report, Sherif Andrawes, Global Head of Natural Resources and National Natural Resources Leader for Australia at BDO, writes that the changes seen since 2017 “include a period of mostly low commodity prices, growing calls from external stakeholders for mining companies to have good environmental, social and governance (ESG) programs, and increased geopolitical tensions that have created uncertainty around demand for raw materials.”
Australia’s presence on BDO’s radar is justified by its position as one of the leaders in the global mining market. Australian-origin BHP Group and Rio Tinto are the top two mining companies in the world.
Much has changed in the Australian market since BDO’s last analysis, although not in all areas. The authors predicted that tech companies would increasingly be involved in Australia’s mining by 2020, a progression that it now describes as “on track – as expected.” The fact that the country’s mining sector is undergoing steady restructuring is indicative that fundamental changes are afoot.
However, while BDO predicted a spike in the number of deals and partnerships in the sector, it also expected a large portion of this deal making to be supported by artificial intelligence (AI). This prediction, according to BDO, has been “off track” with “not much movement” seen in mining’s AI space. The firm also predicted that funding for these deals will become increasingly crowdsourced – which is similarly off track.
Taking stock of the situation, BDO has conducted a fresh review of affairs in the sector and put out three new predictions for 2023. The first of these is the gradual abolition of diesel machinery across underground mines in Australia, particularly new ones. The move is driven by increased awareness surrounding the health risks of inhaling diesel particles.
The researchers also predict an increase in domestic beneficiation operations, something that Australia has been looking to develop for a number of years. Although progress in this respect has been slow thus far, the consulting firm suggests that the current climate of uncertainty might push stakeholders to invest in domestic beneficiation.
Thirdly, the firm has shifted its expectations from crowsourced funding to competitively crowdsourced ideas, through avenues such as hackathons. “Crowdsourcing ideas and analysis of data – often for a prize – will be a quick and cost-effective way for mining companies to progress exploration projects that may be noncore, tricky or unusual,” writes the report.
