The Chinese translation is being made; the original is shown for now.
Uncertainty is now the new normal for the global mining and metals sector, with organizations adapting to greater operational complexity, disrupted supply chains and an increasingly selective capital market, according to a new report from EY.
Responses from 400 senior mining and metals executives worldwide highlight a sector focused on immediate pressures directly affecting mine continuity in EY’s annual mining and metals report. Operational complexity remains mining’s top risk, with capital at second and supply chain at third.
“Mining has always been complex, but the degree of operational complexity is increasing as mines age and reserves are depleted and the new ones are more difficult to mine and process,” said Paul Mitchell, EY Global Mining & Metals leader. “At the same time, geopolitical volatility, changing trade flows and more selective capital are making long-term decisions more complex.
“The important thing is not to wait for this uncertainty to disappear — it won’t. Instead, mining companies must reassess the assumptions underpinning strategies, portfolios and capital decisions and build greater flexibility into how they operate. Those that move early will be the winners.”
According to the report, the top 10 business risks and opportunities for mining and metals in 2027 are:
- Operational complexity
- Capital
- Supply chain
- Rising costs
- Geopolitics
- Carbon
- Sustainability
- Changing business models
- Cybersecurity
- License to operate
The factors driving operational complexity are wide-ranging. Reserve-grade variability (29%) ranks as the second most significant issue after regulatory compliance delays (30.5%). Material handling, labor availability, processing capacity, transport and logistics, and plant and equipment reliability follow closely at 24% to 26%. Depletion reduces operating flexibility by limiting mining areas, feed choices and processing options, making disruptions harder to absorb.
Although Innovation may have fallen out of the Top 10, technology remains critical to productivity and managing complex operations. “AI and other technologies will play an increasingly important role in improving productivity and helping companies manage more complex operations. At the same time, greater connectivity, third-party integration and AI adoption are creating new vulnerabilities, with cybersecurity entering the Top 10,” Mitchell said.
EY research finds that 67% of mining and metals assets sit inside the “vulnerability zone,” meaning they have below-average visibility and cybersecurity controls.
“Mining companies are already adapting through more selective capital allocation, greater supply-chain resilience and new approaches to managing operational complexity. The challenge now is to build enough flexibility into business decisions to respond as conditions change,” Mitchell concluded.
Source: EY
The post Mining sector adapts to prolonged uncertainty: EY report first appeared on North American Mining Magazine.