Mineweb’s Kip Keen speaks at Mexican Roundup, sharing some hopeful thoughts about the junior market.
These are Kip Keen’s prepared remarks as the keynote speaker at Mexican Roundup in Hermosillo, Mexico:
Thank you Jackie Stephens, Mexican Roundup and GlobeXplore for having me. Ok. Buenos dias y lo siento.
I’m going to talk about the state of the mining industry. I promise, at least in the end, this won’t sound like a eulogy, at least as far as juniors are concerned. But first: What a year it’s been.
Just when you thought the mining sector, as a whole, had suffered its worst blows halfway through the year, 2014, it took some more.
By mid last year we had already been through a wave of impairments taken after overpriced boomtime acquisitions – Kinross on Redback Mining and Fruta del Norte; Barrick on Pascua; and so on.
The price of iron ore – the lifeblood of the large diversified miners – already was down by nearly half from close to $200/tonne in 2012 to about $100/tonne in the first half of 2014.
Gold had done its collapsing in 2013 as ETFs sold off and fewer, at least Western buyers, stopped worrying about impending hyper-inflation.
As it turned out the worst wasn’t over.
Iron ore prices resumed freefall as the low cost diversified producers – expanding supply – slugged it out for market share against the high-cost Chinese iron ore miners, all the while steel demand faltered.
Still a vexing situation, that.
Prices sank below $50/tonne for iron ore this year for the first time in half a decade. The big miners – BHP, Rio, Vale – had expected the price to fall, but not so hard and not so fast.
For the rest of this speech, click here: http://www.mineweb.com/regions/canada/light-end-tunnel/