Lisa Wright is a business reporter with the Toronto Star, which has the largest circulation in Canada. The paper has an enormous impact on Canada’s federal and provincial politics as well as shaping public opinion. This article was originally published March 6, 2011.
Lisa Wright (Toronto Star Business Reporter)
With demand for metals red hot again, it feels like the Klondike for miners. An army of 25,000 from 125 countries is expected to show at the industry’s biggest annual blast, opening today in Toronto
Amid boom times in the metals business, the centre of corporate Canada will be transformed into a mining mecca this week as thousands prospectors converge at the Metro Toronto Convention Centre to dig for deals and take advantage of skyrocketing prices.
Investors are also welcome to attend the annual industry blast known as the Prospectors and Developers Association of Canada convention. The hard-rock bonanza draws all walks of the mineral exploration business from the guys who stake claims in the bush to brokers and bankers, students, salesmen, geoscientists and mining company executives from more than 100 countries.
The PDAC’s new president, Scott Jobin-Bevans, says a lot has changed since the first time he attended with his dad — both geologists from Flin Flon, Man. — about 20 years ago when the event was at the Fairmont Royal York Hotel.
“I would say the big difference is the sheer size of it. It’s a monster now,” he says.
Toronto is renowned as the mining business capital of the world, and the sold-out conference is expected to break attendance records with up to 25,000 people packing the south building of the convention centre from this weekend through to Wednesday.
The booths, hallways and meeting rooms will be full of folks poring over maps and talking up exploration projects to get retail investors interested in burgeoning discoveries of all things metallic, from precious metals to the base and industrial metals that are in such high demand lately.
“And Joe Investor off the street can take a look at no cost,” says Jobin-Bevans.
The underlying theme of last year’s record-breaking convention was “We’re Back” after a severe market downturn in 2008 that put a damper on the industry for most of 2009.
“This year, I’d say: ‘We’re back — and then some — and there’s more to come’,” notes PDAC executive director Tony Andrews, referring to soaring metals prices spurred on by red hot demand from China and India.
“The recovery of this industry has been pretty incredible,” he says.
Thanks to ongoing supply concerns and the construction craze in developing economies, most metals are trading at or near record levels.
Gold is back over $1,400 U.S. an ounce and the gold bugs are predicting it will hit $2,000 by year’s end as investors seek a safe haven from global political turmoil and the weakening U.S. dollar.
Silver is on a surprising tear and has doubled in price in just the last three years to $33 an ounce as speculators gobble up gold’s less glamorous cousin.
Key construction metal copper is breaking records again at $4.40 a pound. And analysts are forecasting the trend to continue with prices averaging $5 a pound next year with no new mines coming on stream then.
Meanwhile, even lowly lead continues to climb ever higher at $1.10 a pound and zinc, which is used to galvanize steel, is $1.20 a pound. Both had sunk to half their current price during the market crash of 2008.
“There’s a lot of reliance on China and what it’s going to do for us down the road. It’s still a big part of the story,” says Jobin-Bevans.
The major flooding and recent weather woes of Australia have also restricted the supply of base metals, which in turn affects prices, says Andrews.
Delegates from 125 countries will vie for new investors at the world’s biggest mining convention, with major groups coming from Chile, India, Brazil, China and Mongolia to name a few.
More than half the capital for all global exploration and mining projects is raised in Toronto, including a good chunk of it here this week, where there will be no shortage of sales pitches and tall tales being told over a beverage.
“This industry is global, and it’s a huge networking event. A lot of business gets done here,” says Andrews, now in his 24th year as a PDAC executive and event organizer.
“I’ve seen people in reception lineups and in the corridors shaking hands on a deal they made right there.”
For the rest of this article, please go to the Toronto Star website: http://www.thestar.com/business/article/949298–mining-convention-let-the-hard-rockin-begin