With demand for an array of precious Critical Minerals growing, the global mining industry faces its biggest shakeup in many decades. Central to the Energy Transition, the age of Strategic Minerals has arrived, and mining activity, now more than ever, is vital to a nation’s best interests. Rare metals are the key to ensuring that high-tech industries can survive and thrive, supporting domestic manufacturing, power generation and storage, transport and logistics to defence and national security.  

And with each new development, the race to secure their steady supply heats up.

Australia is one of many countries worldwide to have been blessed with an abundance of Critical Minerals, and alongside China, Chile, the US and others, we remain a lynchpin in global supply chains.

There’s a simple equation here: more demand for minerals equals more mining activity.

And as miners gear up to launch themselves into the next boom, they face various challenges to overcome and improvements to make in their operations. But where there’s a will, there’s a way, and with extreme profits on offer, we can expect the pace of mining activity to pick up around the globe and the race for net-zero gathers speed. But what will mining’s new dawn look like in practice?

Are environmental regulations, health and safety concerns or potential profit loss a concern right now?


Engineering a Critical Minerals Revolution

The transition to a low-carbon economy is not just something that miners facilitate with their products but also something they must embrace internally. Mining remains an incredibly heavy polluter, and in some kind of self-fulfilling prophecy, operators must dig up the raw materials to furnish their own decarbonisation efforts.

Governments are also playing an increasing role in mining activity and its supply chains.

After the supply disruption triggered by the COVID pandemic, governments are looking at Critical Minerals as a strategic priority as uncertainty reigns in the global economy. After noticing rapid demand growth and dangerous levels of supply chain concentration, governments are forming coalitions to implement new policies and activate funding for secure access to Critical Minerals. 

All this combined will have a significant and lasting effect on the mining business. 

An inflow of public funds will also prompt miners to reconsider their rates of return on mining and supply chain assets. While also contending with elevated investment risk and more significant competition as governments skew the playing field in their favour with incentives and interventions. As mining activity ramps up to meet demand, miners worldwide must navigate a fresh and complex web of challenges absent in the industry’s earlier years. 


Mining Activity is Rising, But There’s a Catch…

In 2022, the world’s top 40 mining companies recorded excellent financial performance, with group revenue of US$711 billion, close to the highs of 2021. 

Balance sheets are cash-rich, while critically, debt remains low.

But there’s a fly in the ointment, that of rising costs, as miner’s net profits have taken a hit across the board. In fact, a recent survey showed a leading chunk of mining CEOs were adamant that their seemingly thriving traditional mining businesses would be economically unviable in a few years. 

Amid bulging costs and economic headwinds, their ray of hope remains the Critical Minerals revolution.

In summary, and to address our initial question, mining activity is and will continue to surge over the near future. While this all seems rosy, miners may not be able to rely on the “superprofits” of years gone by and now face an increasingly complex world in which to operate. 

In addition, where traditional mines were set up to export vast amounts of crushed rock essentially, Critical Minerals require much more work to procure and value-added processes before sale. All this will ensure mining is a fascinating industry to watch in the coming years. 


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