What do smart mining supply companies do when commodity prices slide, capital spending dries up and mining companies tighten their belts? They roll up their sleeves, get creative and take advantage of the breathing space to prepare for the next upturn.
That’s what mining suppliers featured in this issue of Sudbury Mining Solutions Journal are doing. They’ve seen it all before. The industry goes crazy trying to meet surging demand, commodity prices soar, exploration spending goes through the roof and getting orders out the door takes precedence over everything else. Analysts gush about a 20-year commodity supercycle, but before too long we read about ghost cities in China, plunging commodity prices, excess supply and asset selloffs.
With the craziness temporarily behind them, forward-thinking companies innovate and invest in expansion.
Industrial Fabrication and RDH Mining Equipment, for example, are taking advantage of a confluence of technological developments and end user challenges to introduce battery powered production equipment and utility vehicles to underground mining. They know that the technology has advanced sufficiently. They also know that mining companies are eager to reduce ventilation costs and provide a cleaner, healthier environment free of diesel emissions. There is only a trickle of sales to date, but both suppliers want to be first to market and ready for the inevitable turnaround.
With exploration in the tank, you might think this would be the worst time to start a new diamond drill rig manufacturing company, but Gord McLaren and Sylvain Brisson of Drillco Mining and Exploration beg to differ. Leveraging their combined 50 years of drilling equipment engineering and operations experience, this North Bay duo have developed a versatile, all-purpose drill rig that can be used underground, on surface or for remote, fly-in applications. They’re convinced that the best time to innovate is during a slump so they’ll be ready when the industry takes off again (see Page 25).
Hardrock Mining Products is a small, Sudbury-based drill steel manufacturer that is investing big time in leading-edge technology, production capacity and diversification. We may be in the midst of a commodities downturn, but company president Lou Sharrock is thinking about the future and leaving something of substance for his grandkids. In quick succession, Hardrock Mining Products purchased a southern Ontario bit manufacturer, laid out $3 million for a new 15,500-square-foot production facility and ordered two atomic bonding machines – also known as friction welders – for $1 million each (see Page 20).
Exploration is always one of the hardest hit parts of the industry, but here too we see green shoots emerging from the barren soil – best exemplified by Premier Gold leveraging cash flow from a 40 per cent stake in the South Arturo Project in Nevada and a partnership with Centerra Gold to bring the Hardrock Project in northwestern Ontario into production in time to catch the next wave (see Page 19).
>Taking advantage of the current lull to prepare for that next wave makes a lot of sense for anyone in the mining industry. Come to think of it, it’s also good advice for those with a role to play in the development of the mineral-rich Ring of Fire, the single biggest development opportunity for Ontario’s mining industry and the First Nations who stand to benefit from it.
