The total stock market valuation of the world’s biggest mining companies is up a fairly modest 8% year to end-September and despite the good run is still $240 billion below the peak hit in the second quarter of 2022. And judging by the performance of the top tier in the final quarter (BHP down 8% QTD, Rio Tinto –5%, Vale –3%, Glencore –5%, Newmont –9%, Zijin –5%, Freeport –7%) the gap won’t be closing anytime soon.

In contrast, Nvidia — the maker of chips highly prized for artificial intelligence (AI) computing — is up nearly 200% so far this year (and 2,600% over five). When comparing the graphics card maker’s stock valuation to the mining industry’s collective worth, it’s difficult not to wonder if something is not awry with how global investors appraise the industrial economy.  

Should Nvidia (or Microsoft or Apple for that matter) be worth more than twice the top 50 miners? Outside the top 50 the average market cap quickly shrinks to the low teens so Nvidia is in fact worth more than the entire listed mining industry. 

Even when extending the top 50 into metals and energy –  steel, aluminium and electricity companies often operate their own mines – Nvidia can still throw shade. BHP does not even crack the top 100 most valuable companies in the world and is worth less than Booking.com, and Temu and Zara’s owners, none of which can exactly be called the building blocks of the global economy. 

Nvidia briefly surpassed Apple on Friday to become the world’s most valuable company. Its market capitalization is approximately $3.5 trillion, just below Apple’s, which remains the highest-valued firm globally.

Anglo said its copper output fell 13% in the July to September quarter, while rough diamond production decreased by 25% on cuts due to prolonged lower demand.

Its De Beers diamonds unit is exploring options for further output cuts in future, Anglo said.

For the first nine months of 2024, copper output fell 4% to 575,000 tons and diamond production was down 21% at 18.9 million carats.

Anglo still expects to produce 730,000-790,000 tons of copper and 23-26 million carats of rough diamonds this year, even as it assesses additional production cuts going forward.

Its shares, which have risen around 18% this year, opened up 2.2%.

The mining giant is restructuring its business to mainly focus on energy transition metal copper after fending off a $49 billion takeover offer from bigger rival BHP Group in May.

Copper will make up 60% of Anglo’s business after it sells its Australian steelmaking coal assets and nickel mines in Brazil, as well as divesting De Beers and its platinum business Amplats in South Africa.

Apart from its copper assets in Chile, Anglo will also retain iron ore mines in South Africa and Brazil, as well as the Woodsmith fertilizer project in the United Kingdom, which it has now slowed down.

Anglo said steelmaking coal’s production fell by 6% in the third quarter after shutting its Grosvenor mine in Queensland due to an underground fire.

The London-listed miner, the world’s third-largest exporter of metallurgical coal, lowered its yearly production guidance to 14-15.5 million tons from a previous forecast of 15-17 million.

Anglo said the final round of bidders for the coal assets was in place and it expected to announce the sale agreement within months.

(By Clara Denina and Felix Njini; Editing by Stephen Coates and Mark Potter)

Potash production is expected to reach 73 million metric tons this year, with Russian exports at 12-13 million tons and those from Belarus at around 10 million tons, Julia Campbell, head of the potash pricing service at commodity price agency Argus, said.

Potash prices have started to normalize following a period of volatility following Russia’s invasion of Ukraine.

“Russian exports dropped sharply after the war in Ukraine began due to financial and logistical challenges. But these problems have since eased,” Campbell said.

Increased exports from Canada, Jordan and Laos have also boosted global supply and brought down prices, adding to the fears of possible oversupply, with a slight improvement in demand expected only in 2025.

During their half-year earnings reporting, major potash producers such as Germany’s K+S sounded optimistic about growing demand and stabilizing prices.

However, analysts have since warned the abundant global supply would put a cap on pricing, dampening the companies’ earnings prospects.

“I don’t think there’s likely to be any sort of premium pricing or any real pricing benefit as a result of the global supply shift and the global trade shift. We saw that mostly in 2022 and into 2023 when prices were still moderating,” Morningstar analyst Seth Goldstein told Reuters.

As such, Canada’s share of global potash trade increased significantly in 2022, while those of Belarus and Russia declined. Prices have since dropped below $300 a ton from a mid-2022 peak of $1,000, on weak demand, data from Argus showed.

“We are likely nearing the operational cost of production, which may force some companies to curb production,” Rabobank analyst Paul Joules said.

Canada’s Nutrien, the world’s top producer of the mineral mainly used in fertilizers, suspended its ramp-up plans for potash production in August, citing market conditions.

Rising shipments, growing concerns

Russian producers have increased shipments to China and India via new rail routes since Russia exited the Black Sea grain deal last year. This has boosted demand in Southeast Asia and South America, Morningstar’s Seth Goldstein said.

Belarusian exporters have shifted cargo from Baltic ports to Russian ones and are offering potash at a discount via these new routes bypassing sanctions, he added.

Meanwhile, Swiss-based Eurochem is expanding facilities at its Usolskiy and Volgakaliy sites in Russia.

“The MOP (muriate of potash, or potassium chloride) sector specifically, is already experiencing a period of very heavy supply,” said Humphrey Knight, an analyst at CRU London.

Farming the price drop

The fall in potash prices has improved affordability of some grains and oilseeds, fertilizer consultant Delphine Leconte-Demarsy from the UN Food and Agriculture Organization said.

“In the US, potash remains more expensive than it was before the price hike, but this is compensated by comparatively higher crop prices,” Leconte-Demarsy said.

But she added local farmers were affected differently depending on logistical costs and exchange rates.

“In China, while potash is currently more affordable than before the price hike for wheat and maize, depressed rice markets curb potash use for this crop,” she said.

In Brazil, a major exporter of agricultural products, potash prices are back to 2019 levels, boosting its use for more highly priced crops such as soybeans and maize.

Farmers will continue to reap the benefits as the tight market is expected to keep potash prices below historical averages, Rabobank’s Joules said.

($1 = 0.9215 euros)

(By Tristan Veyet, Jesus Calero and Luca Fratangelo; Editing by Milla Nissi, Matt Scuffham and David Evans)

Explorers and developers often overstate the certainty of mineral resource classifications based on inadequate data, Desharnais said at an event in Vancouver on Wednesday. The practice has in some instances led to unexpected analyst downgrades, soaring costs and debt, and the derailment of promising assets.

“That classification debt, unfortunately, needs to get paid,” he told about 430 conference participants from 21 countries at CIM’s first Mineral Resources & Mineral Reserves conference. “The CEO may be walking around with a 3-million-oz. resource estimate, but they haven’t earned that classification with sufficient drilling. When the debt comes due, it’s often through painful reclassifications and revisions.”

Decade of missteps

Several recent projects have demonstrated the high cost of classification debt.

Rubicon Resources’ catastrophic 91% downgrade in resource estimates in 2015 stands as one of the most glaring examples. After it began initial production at the F2 gold deposit on its Phoenix property in Ontario’s Red Lake district, the company found the deposit to be uneconomic, shuttering the operation. It had not completed a feasibility study for the high-grade project.

The size of the downgrade blindsided investors and stakeholders, and the company had to undergo a painful restructuring to survive. Rebranded as Battle North Gold, Evolution Mining (ASX: EVN) bought it and its renamed Bateman project in 2021 for $343 million.

In 2018, Pretium Resources promoted the Brucejack gold project in northwestern British Columbia’s Golden Triangle, now owned by Newmont (NYSE: NEM, TSX: NGT, ASX: NEM, PNGX: NEM), as a high-grade gold deposit. Yet, the asset disappointed when gold production grades fell far below expectations.

The nuggety nature of the gold, with Brucejack’s steeply dipping quartz veins and erratic grade distribution, made it difficult to consistently meet production targets, forcing the company to push tonnage through the mill to compensate for lower-than-expected grades.

Aurora (2018), Rainy River (2019), and Gold Bar (2020) show how resource overestimation hurt Guyana Goldfields, New Gold (TSX: NGD; NYSE: NGD) and McEwen Mining (TSX: MUX; NYSE: MUX). They had to downgrade estimates mid-operation. This triggered mine plan revisions, soaring costs, production delays, and financial strain.

Grade versus geometric risk

Desharnais identifies two types of risk that contribute to resource misclassification: grade risk and geometric risk.

Grade risk reflects patchiness in ore quality, while geometric risk involves uncertainty about the size and shape of mineralized domains within the deposit.

Conditional simulations help assess grade risk, Desharnais said, but tools to quantify geometric risk are lacking.

Companies often overestimate deposit geometry without tighter drilling, leading to costly misjudgments.

“Sparse drilling gives us a simpler picture than reality,” he explained, adding that only closely spaced drilling can reveal the true complexity of orebodies.

Best practices

Mathieu Doucette, a senior geologist at ArcelorMittal (NYSE: MT), talked about the difficulty of classifying resources at Canada’s largest iron mine, the Mont-Wright iron ore mine in Quebec, producing continuously since 1974. Outdated data can affect current resource estimates. He illustrated how mixing in fresh drill holes helps manage geological risk as part of a dynamic model essential to avoid misclassification.

“The first thing [a QP] will do is akin to lighting a torch,” he said. “But everything on the edges is dark, and you can’t really see it. Drill holes are our ability to try and get some information, but sparse data hides the full picture.”

David Machuca-Mory, a principal consultant at SRK Consulting, said fixed models are risky. Deposits can be more unpredictable than they seem. Adaptive methods help ensure estimates reflect reality, reducing the chance of costly surprises.

“Even with dense drilling, some areas remain highly uncertain,” Machuca-Mory said. “Confidence intervals are large, and relying solely on drill spacing doesn’t always guarantee accurate classification.”

Cognitive biases

Desharnais said that misclassification is not just a technical problem; human psychology plays a significant role.

Anchoring bias makes companies stick with initial estimates despite new data. Authority bias pressures geologists and consultants to confirm favourable results to please management or investors.

“The consulting firm wants the next contract,” Desharnais said. “The CEO has family and friends invested and needs good news. These biases create a system where classification debt builds up across projects, only to be paid through painful revisions later.”

Owning up

Desharnais argued for more conservative resource models and said benchmarking against operating mines would help set realistic expectations. He suggested that technical reports include histograms that show the distance between drill holes and classified resources, he added.

“It forces the QP or CP to look at what they’ve done and ask: Does this make sense?” he said. “Transparent reporting would help prevent overly aggressive classifications, ensuring companies earn their resource classifications with sufficient data.”

Such measures may slow development, but they could also reduce the prevalence of misclassified resources in the industry. Desharnais urged geologists to scrutinize each block of material above the cut-off grade.

“Over-promising today only delays the inevitable correction tomorrow,” he said.

Milton, which led to at least 17 reported deaths, added to piles of debris following Hurricane Helene.

Mosaic said it will provide an update on production losses from Milton and Helene as recovery efforts progress. Early assessments show limited damage to its facilities and products in warehouses, according to a company statement. It added that power has been restored to all facilities.

Mosaic said on Friday that water supporting its storage of a waste byproduct from fertilizer manufacturing at a facility in Riverview, Florida, probably made its way into Tampa Bay following a downpour from Milton. The industrial byproduct, phosphogypsum, is known to emit radon, a cancer-causing radioactive gas.

The company said on Monday that “no significant environmental impacts occurred” due to the recent storms.

(By Tom Polansek; Editing by Mark Porter)

At the end of the third quarter of 2024, the MINING.COM TOP 50* ranking of the world’s most valuable miners had a combined market capitalization of $1.51 trillion, up just under $76 billion from end-June, largely on the back of gold and royalty stocks.

The total stock market valuation of the world’s biggest mining companies is up a fairly modest 8% year to end-September and despite the good run is still $240 billion below the peak hit in the second quarter of 2022.  

Ranks, value of gold stocks swell

The value of precious metals and royalty companies climbed by a combined $42 billion or 16% during the quarter and gold counters dominate the best performing ranks. 

Were it not for the limited tradability of stock in Russia’s Polyus, which lost some ground over the three months despite gold’s stellar performance, bullion’s effect on the Top 50 would have been even more pronounced. 

Canada’s Alamos Gold joins the top 50 for the first time with a  more than 31% jump in value lifting it six places to number 48 with a valuation of $8.2 billion at the end of the quarter while the second quarter’s newcomer Pan American Silver (following its absorption of Yamana Gold) hangs on at no 50.

Alamos Gold last month raised its production guidance by over 20% for 2025-2026 with the inclusion of the Magino mine and its integration with its Island Gold operation in Ontario. The Toronto based miner has long term ambitions to grow its production base to 900,000 ounces per year.

Uzbekistan is readying an IPO for Navoi Mining and Metallurgy Combinat – the world’s fourth largest gold mining company and significant uranium producer in 2025. NMMC debuted a $1 billion bond offering last week, marking the first global debt market issuance from a gold mining company since June 2023.

Navoi should easily join the ranks of gold producers in the top 50 thanks to ownership of the world’s largest gold mine, Muruntau, and annual production of 2.9 million ounces at grades and per ounce extraction costs the envy of the sector.  

The Muruntau open pit mine southwest of the Kyzylkum desert, originally developed during the Soviet era as a source of uranium, has estimated reserves of around 130 million ounces of gold. 

Goldilocks copper

Copper specialists, and those with fat gold credits, have gained a combined 36% year to date as the copper price continues to flirt with the $10,000 a tonne level but momentum slowed dramatically during Q3 with the group contributing only $7.2 billion in added market worth during the quarter. 

Amman Mineral’s fierce rally also came to an abrupt halt during the quarter with the counter losing 18% over the three months and coming close to falling out of the top 10.

Investors who bought Amman, owner of the world’s third largest mine worldwide in terms of copper equivalent, at the IPO price in Jakarta a year ago, are still enjoying 400% gains since then however. 

Southern Copper’s position as the world’s third most valuable mining stock seems entrenched after a double digit percentage gain in Q3 compared to a much more sedate performance by Freeport-McMoRan which now has to gain a full $20 billion in market cap to haul in its Mexico City-based rival.

Light on lithium 

Rio Tinto’s vote of confidence in the long term future of the lithium sector (and its own ability to make M&A work) dominated the news at the start of the December-quarter but it’s worth noting that Arcadium’s more than 90% surge since the all-cash offer was first announced are not enough for the stock to enter the rankings.

Three lithium counters exited the rankings this year, Australia’s  Pilbara Minerals and Mineral Resources and China’s Tianqi Lithium as the deep slump in prices for the battery metal continues to take its toll.  

Last quarter’s no 50, Ganfeng Lithium jumps six places after being swept up in the stimulus-induced rally on Chinese stock markets at the end of the quarter while Tianqi’s performance so far in October should see it reenter the Top 50 in due course. 

Ganfeng was barely holding on at position 50 at end-June and with gold price momentum continuing and two gold mining companies waiting in the winds – Yintai and Alamos – only three lithium counters in the top 50 may be a reality for some time to come. 

After peaking in the second quarter of 2022 with a combined value of nearly $120 billion, the remaining lithium stocks’ market value has now shrunk to $34 billion.  

Iron ore ground down

Despite a modest improvement during the quarter, the mining industry’s traditional big 5 – BHP, Rio Tinto, Glencore, Vale and Anglo American – remain in the red for 2024, losing $24 billion since the start of the year. 

The big 5 diversifieds now make up 29% of the total index, down from a height of 38% at the end of 2022.  

Iron ore’s less than rosy outlook – the late boost China’s recent stimulus package notwithstanding – saw Fortescue once again feature on the biggest losers list and Cleveland Cliffs exit the ranking with the US iron ore miner’s 37% decline this year exacerbated by its inability to capitalize on the blocking of the Nippon-US Steel tie up. 

Iron ore’s representation in the top 50 have diminished in the last couple of years – Brazil’s CSN Mineração dropped out during Q1 this year while Anglo-controlled and separately-listed Kumba Iron Ore has lost touch with the top tier after a 40% fall year to date.

Click on image for full size table.

NOTES:

Source: MINING.COM, stock exchange data, company reports. Share data from primary-listed exchange at close Oct 4, 2024 close of trading converted to US$ where applicable. Percentage change based on US$ market cap difference, not share price change in local currency.  

As with any ranking, criteria for inclusion are contentious. We decided to exclude unlisted and state-owned enterprises at the outset due to a lack of information. That, of course, excludes giants like Chile’s Codelco, Uzbekistan’s Navoi Mining (the gold and uranium giant may list later this year), Eurochem, a major potash firm, and a number of entities in China and developing countries around the world.

Another central criterion was the depth of involvement in the industry before an enterprise can rightfully be called a mining company.

For instance, should smelter companies or commodity traders that own minority stakes in mining assets be included, especially if these investments have no operational component or warrant a seat on the board?

This is a common structure in Asia and excluding these types of companies removed well-known names like Japan’s Marubeni and Mitsui, Korea Zinc and Chile’s Copec. 

Levels of operational or strategic involvement and size of shareholding were other central considerations. Do streaming and royalty companies that receive metals from mining operations without shareholding qualify or are they just specialised financing vehicles? We included Franco Nevada, Royal Gold and Wheaton Precious Metals on the basis of their deep involvement in the industry.

Vertically integrated concerns like Alcoa and energy companies such as Shenhua Energy or Bayan Resources where power, ports and railways make up a large portion of revenues pose a problem. The revenue mix also tends to change alongside volatile coal prices. Same goes for battery makers like China’s CATL which is increasingly moving upstream, but where mining will continue to represent a small portion of its valuation.  

Another consideration is diversified companies such as Anglo American with separately listed majority-owned subsidiaries. We’ve included Angloplat in the ranking but excluded Kumba Iron Ore in which Anglo has a 70% stake to avoid double counting. Similarly we excluded Hindustan Zinc which is listed separately but majority owned by Vedanta.

Many steelmakers own and often operate iron ore and other metal mines, but in the interest of balance and diversity we excluded the steel industry, and with that many companies that have substantial mining assets including giants like ArcelorMittal, Magnitogorsk, Ternium, Baosteel and many others.

Head office refers to operational headquarters wherever applicable, for example BHP and Rio Tinto are shown as Melbourne, Australia, but Antofagasta is the exception that proves the rule. We consider the company’s HQ to be in London, where it has been listed since the late 1800s.

Please let us know of any errors, omissions, deletions or additions to the ranking or suggest a different methodology.

Nevertheless, says McKinsey, the industry is in healthier financial shape compared to historical averages. 

From 2000 to 2023, metals and mining revenues grew by $1.7 trillion, a jump of roughly 75% and affording the industry a 70% slice of the overall materials business which also includes plastics, pulp, and building materials. As a whole, materials represent some 7% of the global GDP.  

Profits in the industry have also been robust with mining, refining and metal fabrication EBITDA nearly doubling over the almost quarter century going from $500 billion to $900 billion. 

Moreover, Mckinsey points out, mining and metal companies’ debt burden has decreased with net debt over EBITDA ratios of 1.3 times, well below the through-cycle average of 1.8 times. 

“However, 2024 has already proven to be a more challenging year for the industry as overall economic growth slows down and the shift toward low-carbon technologies unfolds more slowly than expected, both of which are putting downward pressure on price levels, especially for battery materials, such as nickel and lithium,” McKinsey says.

Not only are battery and other metals associated with decarbonisation facing headwinds, the sector – even when lumping in bellwether copper – hardly makes up 15% of global metals and mining revenues. Until such time the copper price reaches the levels predicted by more outlandish scenarios, the share is not likely to grow much.  

For instance, the market size of rare earths mining, and metal and alloy production (included in the other section of the graph) which is used in defence applications and many energy transition applications including wind turbines and motors for electric vehicles, is below $20 billion.

Thermal coal and steel account for around 60%–70% of revenues and production volumes of 7 billion tonnes and 2 billion tonnes respectively are more than 30 times higher than all other metals and minerals combined. Output by the largest among the latter, aluminum, at roughly 100 million tonnes, does not make much of a dent in the overall total.

The bulk of mining and metals activity and revenues remains subjected to the ups and downs of the global economy, particularly the outlook for China where the signs are not great.  

While the green energy transition may rightfully represent a new dawn for mining, it’s still very early in the morning.

Jansen mine is expected to produce potash at costs that are less than the top Canadian operations of fertilizer giants Nutrien Ltd. and Mosaic Co., according to BHP’s Karina Gistelinck. She said the massive size of the operation and BHP’s heavy investment in automation are key to keeping costs down to be more competitive than other mines in Canada, the world’s top supplier.

“The strategy is to be the most cost-effective mine possible,” she said in an interview. “Even with depressed prices, we’ll be profitable.”

BHP remains optimistic on Jansen even though potash prices have tumbled more than 60% from highs seen two years ago. Prices soared in early 2022 after sanctions on Belarus and Russia’s war in Ukraine stoked fears of supply shocks in a tight market. The two nations are among the top producers of potash and, combined with Canada, account for two-thirds of the global trade.

The world’s biggest miner had already committed $5.7 billion to building the first stage of Jansen in the western Canadian province of Saskatchewan back in August 2021. Two years later, BHP earmarked an additional $4.9 billion for an expansion due to its confidence in the potash market. The spending is on top of an earlier $4.5 billion investment in the area.

Since Jansen’s approval, flows of fertilizer from Russia and Belarus have rebounded and driven down potash prices. BHP’s flagship mine is now expected to pour millions of fresh tons into a balanced market rather than one crying out for new supplies that BHP had anticipated.

Jansen is expected to deliver 4.2 million tons of potash when the first phase starts production in 2026, adding 5% to the current global potash supply, according to Gistelinck. Output is expected to double by 2031, when the project reaches full capacity.

Gistelinck said she anticipates Jansen will produce potash for less than $140 a metric ton. Market prices are expected to range from $300 a ton — in the worst-case scenario — to as high as $450 a ton in the medium to long term, she said.

BHP plans to sell the fertilizer to distributors rather than directly to farmers. The company has already secured commitments for its full potash production, which are expected to become binding contracts next year.

The Melbourne-based company is also mulling initial discounts to gain market share, Gistelinck said.

BHP is targeting Brazil — an agricultural powerhouse that’s highly dependent of fertilizer imports — as well as Southeast Asian nations and the US as major markets for selling its potash as it seeks to reduce exposure to China, she said.

Gistelinck sees demand for the crop nutrient rising 2% annually over the next two years, tracking population growth, while external factors such as the impacts of climate change could also boost consumption.

“Catastrophic events will happen more often and for longer,” she said. “And potassium helps a lot with the resilience of agricultural products.”

(By Mariana Durao)

“Uralkali confirms the signing of a contract with India at a price that objectively reflects current market conditions, with a supply volume of 600,000 tons of potassium chloride,” an Uralkali representative said.

The contract was signed earlier this year, according to source with direct knowledge of the matter.

The source said the price for April-September supplies was $279 per ton on a CFR or delivered basis and $285 per ton for October-December. Russia is a major supplier of fertilizers to India.

(By Anastasia Lyrchikova, Gleb Bryanski and Nidhi Verma; Editing by Mark Trevelyan)

Australian mining giant BHP expects Brazil to become one of the three largest markets for the major potash project it is developing in Canada, the company’s local head told Reuters on Tuesday.

Potash, along with nitrogen and phosphate, is a primary nutrient essential for food production, and Brazil is one of the world’s largest food suppliers but imports most of its fertilizer needs.

“Brazil is expected to be one of the top three markets for BHP for potash. So it’s very, very important for us,” the miner’s general manager in Brazil, Carla Wilson, said in an interview on the sidelines of a mining conference.

The first phase of BHP’s Jansen potash project in Canada is scheduled to come online in 2026 with annual production capacity of 4.2 million metric tons, following investments of $5.7 billion.

A second phase expected to double the mine’s capacity will require an additional $4.9 billion investment, according to the company.

BHP is working on building connections with potential long-term potash buyers in Brazil, said Wilson, noting that the first phase of the Canadian project is just over 50% complete.

“At this point in time, we’re just slowly starting to build our presence and starting to build those long-term relationships with customers here,” the executive said.

(By Marta Nogueira; Editing by David Alire Garcia)

Read More: BHP, Sandvik extend mining system partnership at Jansen potash project

The Jansen project is currently in the Stage 1 construction phase, which BHP recently said is at the midway point of completion and on track for first production in late 2026. Stage 2 production is expected to follow after a three-year ramp-up period.

The new contract follows several years of collaboration and the ongoing execution of the Stage 1 project, for which BHP awarded Sandvik a contract to supply four potash underground continuous mining systems in 2022.

Deliveries of the systems for Stage 2, for which construction is also underway and at the 2% completion mark, are expected to begin in 2028 and continue through 2029, when it’s scheduled to enter production.

“We are proud to continue our partnership with BHP and strengthen our collaboration further with this new order for three additional systems,” Sandvik Mining and Rock Solutions president Mats Eriksson said in a news release.

Each mining system consists of a cable-powered Sandvik MF460 borer miner and a Sandvik PO140 extendable conveyor continuous haulage system. Sandvik MF460 will cut widths of 6.3 metres and heights of up to 4.36 metres per cut, with one cut and return cut up to 2 kilometres in length. Each integrated system is capable of producing around 1,300-1,500 tonnes per hour.

BHP commissioned Sandvik to do the engineering design of Sandvik MF460 from 2010 to 2012. With the borer miner’s high-volume production creating a materials handling challenge, BHP also commissioned Sandvik to concept design and test a simple version of Sandvik PO140 in 2014.

Following successful testing, the companies signed a manufacturing and testing agreement for one Sandvik MF460 and one Sandvik PO140 in 2016. The complete system proved highly productive during tests at the SWS (Südwestdeutsche Salzwerke AG) salt mine in Germany from 2018 to 2021, doubling the industry benchmark for tonnes per hour, Sandvik said.

Improvements were identified and designed for these systems to further increase their productivity and reliability, including installing ground support roof boltings while cutting and loading, reducing turnaround and relocation time and remote operations potential.

The Jansen project has the potential to be one of the largest potash mines in the world, capable of producing approximately 8.5 million tonnes of the key fertilizer ingredient per year.

The partnership will include collaborative research on arable crops such as corn, soybean, potato, rice and high value ones like apple, citrus and grapes, Anglo said.

Anglo said it will supply polyhalite from its multi-billion-dollar Woodsmith mine project in North Yorkshire as part of the agreements, even as it pushed back the date of first production from 2027 and took impairments of $3.3 billion so far.

The company has been looking for partners for the project as part of a wider overhaul of its business, and said the division is one of its three pillars alongside copper and iron ore after its restructuring.

“Given our Crop Nutrients business forms part of Anglo American’s exceptional growth trajectory over the next decade, we are continuing to foster strategic partnerships,” said Tom McCulley, CEO of Anglo’s Crop Nutrients.

The London-listed miner says polyhalite, a naturally-occurring mineral containing nutrients including potassium, calcium, magnesium and sulphur, has the potential to improve the crop yield by 3% to 5%. It says fertilizers using the mineral are low carbon and soil friendly.

The Woodsmith mine has the world’s largest known deposit of the mineral.

(By Clara Denina and Shanima A; Editing by Nivedita Bhattacharjee and Miral Fahmy)

Chief executive officer Mike Henry, announcing full-year profit broadly in line with market expectations, underlined the mining giant’s efforts to double down on its own projects and mines — even after appetite for the red metal motivated last month’s acquisition of Filo Corp. jointly with Lundin Mining Corp., and, earlier in the year, the failed $49 billion effort to take over smaller rival Anglo American Plc.

“The Plan A for BHP was never about acquisitions and it wasn’t about that specific opportunity,” Henry told Bloomberg Television, when asked if the company could revive its Anglo bid. “It was about everything that you see in this set of results, which is focusing — first and foremost — on ensuring that we’re getting the most out of our capital.”

In the near-term, though, BHP underlined the impact China’s uneven recovery and volatility in global commodity markets, with iron ore supply outpacing demand into next year as surplus steel floods the market.

“What we’re seeing play out in the market is really a fine balance between steel demand and iron ore supply,” Henry said.

China’s slowing economy and languishing property market are damping demand for metals, especially steelmaking staple iron ore, which accounts for almost two-thirds of BHP’s revenue. The head of China Baowu Steel Group Corp., the country’s biggest steel producer, warned this month the industry faced a situation worse than crises in 2008 and 2015.

Both iron and copper have weakened since the end of the reporting period, potentially signaling more challenging times ahead.

Headline earnings still underscored the continued resilience of the miner’s core iron ore and copper operations. Underlying attributable profit came in at $13.66 billion for the year through June, up 2% from the year earlier and just above analysts’ estimate of $13.49 billion. The company’s share price rose as much as 2.7% in Sydney following the earnings release.

The company spent $9.3 billion in capital and exploration in the period, up 31% from the year before. It aims to expand that spending to $11 billion by fiscal 2026, with two third of the amount on copper and potash.

The red metal currently generates just under 30% of BHP’s sales. Output rose 9% over the year through June, and the company is forecast a further 4% expansion this year, an improvement on peers who have seen less reliable increases.

“What was positive was just the continued focus on copper growth – the amount of options they have in their portfolio and what levers they can eventually pull,” RBC Capital Markets analyst Kaan Peker said. While concerns remained around China’s slowdown in iron ore and steel demand, there was a sense from BHP “that maybe the demand picture isn’t as negative as it seems,” he added.

Potash play

BHP’s overall revenue rose 3%. Higher sales volumes and relatively strong prices for iron ore and copper were partially offset by lower coal prices and a crash in nickel, caused by a surge of cheap Indonesian material that ultimately prompted the miner to shutter its Nickel West business.

Potash may prove another bright spot for BHP. Its $14 billion potash mine in Canada’s Saskatchewan region is expected to produce more than 4 million tons of the crop nutrient annually from 2026. Last year, BHP approved an expansion to more than double the production.

The Melbourne-based company is looking at a potential expansion of its Western Australia iron ore business to lift output to 330 million tons annually, compared with 260 million tons in the year just completed. Henry said that was contingent on market factors, and that China’s steel demand had plateaued.

“Some sectors of the Chinese economy that drive steel demand, such as shipbuilding and the auto industries, are actually performing quite healthily,” Henry said.

BHP is the latest diversified miner to demonstrate heft can, for now, help weather the China property storm. Rio Tinto Group’s first-half profit was slightly higher than a year earlier. Vale SA — the world’s No. 2 iron ore producer — posted second-quarter earnings that were only just below analyst estimates.

BHP will pay a final dividend of 74 cents per share, compared with 80 cents a year ago.

(By Paul-Alain Hunt)

The company has filed a preliminary prospectus for the offering with the US Securities and Exchange Commission. Cantor Fitzgerald & Co, Banco Bradesco BBI, Freedom Capital Markets, Roth Capital Partners, and Clarksons Securities have been appointed to coordinate the IPO.

Details such as the number of shares to be offered, the amount to be raised, and the timing of the public offering have not been disclosed.

“The company’s choice to do an IPO on the US stock exchange is because this will give the company greater visibility to attract global investors to its operations, much more than if it opted to list its shares on the Brazilian stock market,” mining consultant Pedro Galdi told BNamericas.

“Furthermore, the scenarios for equity markets in the US and Brazil are pointing in opposite directions. In the US, there is an expectation of a reduction in interest rates in the coming months, which favors investment in shares, while in Brazil, where interest rates remain high, there is an expectation of new increases in interest rates in the coming months, in light of future inflationary pressures,” he said.

The Autazes project

The funds will cover additional engineering and essential tests on critical items like shaft sinking and power transmission lines, as well as necessary permits and applications for the company’s Autazes project.

Brazil Potash began construction in May on the Silvinita mine in Autazes after it received six more licences from the Amazonas Environmental Protection Institute, the agency responsible for environmental licensing in the state.

The project is pegged to be the largest fertilizer mine in Latin America within the Amazon rainforest.

Production is expected to start in 2026 with an initial output sufficient to cover about 20% of Brazil’s potash needs. The project capacity will be 2.2 million tonnes of potassium chloride per year, the company estimates.

The project, which could reduce Brazilian agriculture’s 90% dependence on imported potash, has been held up for years due to opposition from indigenous Mura people, who say they have not been consulted about the use of their ancestral lands.

Members of Escondida’s powerful Union No. 1 signed a sweetened deal on Sunday after walking off the job a week ago when contract talks collapsed, demanding better pay and benefits at the world’s biggest copper mine.

With a preliminary deal in hand already on Friday, a union lawyer had termed the agreement its “greatest recent victory.” It gave each worker a bonus and interest-free loan of about $34,000, compared with BHP’s original offer of some $28,900.

The quick turnaround contrasts with a 2017 walkout that dragged on for a month and a half, severely hitting BHP’s production, boosting global copper prices and even denting Chile’s GDP, heavily reliant on the red metal.

That was a scenario BHP wanted to avoid, particularly given strong current demand and global copper prices, analysts and other experts said. Demand for the metal is expected to shoot up, driven by the rise of electric vehicles and artificial intelligence technologies.

“The specter of the 44-day strike in 2017 created constant fear throughout the negotiations,” said Andres Gonzalez, an analyst at mining consultancy Plusmining. “BHP wanted to avoid something similar, which pushed them to seek an agreement.”

The two sides were also not so far apart when the strike started, he noted, making a middle ground easier to achieve.

The union’s position also appeared to be buoyed by the public perception of BHP having capital to spare. The miner is among the world’s biggest, turning out more than a million metric tons of copper a year at Escondida alone. It recently sought Anglo American in a $49 billion deal before scrapping the offer.

“Its current image is that of a company that has capital available to acquire assets or even invest in mergers … so the union was going to insist on achieving its goals,” said Cristian Cifuentes, an analyst at Chilean think tank Cesco.

Despite occasional strikes, Chile’s mining industry largely manages to renew workers’ collective contracts without conflict and even in advance, avoiding the risk of disrupting production.

Escondida is unique due to its large size and powerful union, which represents 2,400 people, almost all in key operational roles. The union has frequently clashed with BHP.

“Profits have to be paid to workers”

Analysts are now watching whether Escondida will set a precedent, but say other mines in Chile are not necessarily in similar situations, such as those that are smaller or grappling with problems in production and costs.

State-run copper giant Codelco, fighting to revive production from a 25-year low, is due for pay negotiations at its Ministro Hales mine in September, followed by the El Teniente and Gabriela Mistral mines in October.

At each site, the unions represent a substantial part of the overall workforce. Of particular note is El Teniente, one of Codelco’s biggest mines, a complex that represented more than a quarter of company copper production last year.

El Teniente workers are represented by five separate unions, but those combined represent more than 80% of total workers, or 3,200 people.

“What is worrying is how the unions at El Teniente will react,” Cifuentes said.

Workers from one of three unions at Lundin Mining’s Caserones copper mine in Chile also went on strike one day before the Escondida strike and remain so.

“The price of copper has been quite favorable in recent months… Those profits have to be paid to the workers,” said Marco Garcia, president of the striking Caserones union, though he admitted the Escondida union had more “productive pressure.”

“We know that the next three years will be quite profitable for Caserones in the production of copper,” he added. “That’s what leads us to our position and to be able to demand higher wages for the members of our union.”

The Caserones management is due to negotiate with other unions at the site later this year.

The head of Chilean mining association SONAMI, Jorge Riesco, cautioned that it is necessary to strike a balance between worker pay and industry competitiveness.

“It is legitimate for workers to aspire to better working conditions, but it is important that they also consider other aspects,” he said. “Issues of labor productivity and industry competitiveness should also be on the table.”

(By Fabian Andres Cambero and Daina Beth Solomon; Editing by Adam Jourdan and Matthew Lewis)

This approach has been central in BHP’s development of the Jansen potash mine in Saskatchewan, where it started building relationships with local Indigenous groups surrounding the site almost a decade before construction began. First production is expected in 2026.

The launch date of CIPP on August 9 coincides with International Day of the World’s Indigenous Peoples, which is meant to encourage people from around the world to spread the United Nation’s message on the protection and promotion of the rights of Indigenous peoples.

The aim of the CIPP, according to BHP, is to support Indigenous well-being, develop impactful partnerships, ensure accountability, and achieve Indigenous employment and procurement targets.

The program aligns with the Australian miner’s global ambition to create social value and operate with integrity, it said. In part, it is a response to Action 92 of the Truth and Reconciliation Commission’s Calls to Action, and as such, is guided by the United Nations Declaration on the Rights of Indigenous Peoples.

Moving from paper to action, an internal team at BHP will lead implementation of the CIPP, supported by a new external Indigenous advisory circle for Jansen, the company said, adding that the advisory circle is composed of community leaders, cultural advisors, experts in Indigenous rights, legal professionals, environmental consultants and representatives from Indigenous communities.

Together, they will focus on incorporating Indigenous methodologies and fostering reciprocal relationships to achieve social, economic and environmental outcomes, and will report progress annually, BHP said.

“Through the CIPP we are seeking to incorporate Indigenous methodologies and work in a way that respects physical, mental, emotional and spiritual interconnectedness. The CIPP aims to foster reciprocal relationships, contribute to social, economic and environmental outcomes, and support reconciliation through procurement, hiring and business opportunities,” said Simon Thomas, vice president project, potash.

“BHP’s approach centers on listening to Indigenous voices, building respectful and lasting relationships through consultation, engagement and shared goals,” added Karina Gistelinck, asset president, potash.

“The plan reflects input from Indigenous partners and emphasizes continuous learning and adaptation. Our team is committed to transparency, accountability and working collaboratively to achieve mutually beneficial outcomes for Indigenous communities and the company.”

Mark Thompson, who has been with Nutrien for 13 years and currently serves as chief commercial officer, will assume his new role on August 26. He is set to replace Pedro Farah, who will remain with the company in an advisory capacity until the end of 2024, it said in the statement.

Since April last year, at least eight senior executives or managers have been let go or have resigned from the company. This exodus included members of Brazil’s entire supply management team, as well as the chief executive officer and CFO for Latin America.

The company started its Brazilian expansion soon after its 2018 formation through the merger of Potash Corp of Saskatchewan and Agrium Inc, which had one small fertilizer maker in Sao Paulo state.

By 2022, the company operated in 13 Brazilian states and had about 200 commercial units in Latin America, a region in which it has been present for over 25 years.

This year, however, the potash and other fertilizers producer revealed it may sell its retail operations in Argentina, Chile and Uruguay to focus on Brazil and other key markets.

Nutrien’s challenges in South America surfaced as fertilizer companies grappled with volatility in global markets, following Russia’s invasion of Ukraine in 2022. The geopolitical change caused prices to soar, only for them to then collapse the following year as farmers postponed purchases and global supplies stabilized.

The company’s second quarter results presented a mixed bag, with net earnings of $392 million, down from $448 million in the same period last year. 

Sales reached S$10.2 billion, a decrease from the $11.7 billion fetched in the second quarter of 2023. Diluted earnings per share came at 78 cents US, down from 89 cents US a year earlier.

Its adjusted earnings beat analysts’ estimates, as they reached $2.34 per share for the quarter ended June 30, compared with analysts’ average estimate of $2.21 per share.

Nutrien attributed the result to strong potash sales volumes, which climbed to 3.56 million tonnes during the quarter, compared with 3.38 million tonnes in the same quarter of 2023.

The Saskatoon-based firm said in July that fertilizer demand was just beginning to stabilize after the dramatic upheavals of the past few years, but expected better market conditions have yet to materialize.

“Though crop price fundamentals aren’t great, patient investors might wait for the realization that nitrogen fundamentals are outperforming crop prices (because of strong energy price differentials), and potash demand is accelerating (as well, potash prices seem trough-y now)”, BMO fertilizers and chemicals analyst, Joel Jackson, wrote in a note to investors.

Shares in Nutrien were slightly down in New York on Thursday in pre-market trading, changing hands at $46.57 — 1.08% lower than their closing price on Wednesday. The crop nutrients giant has a current market capitalization of C$31.96 billion ($23.2bn).

The company is second on our list of Canadian miners by last year’s net income at $1.9 billion. It attributed this year’s first-quarter net income of $347.2 million to cost control, nearly 880,000 oz. in output and a record gold price.

“Some of the highlights include our second consecutive quarter of record operating margins and our second consecutive quarter of record free cash flow ($395.6 million),” president and CEO Ammar Al-Joundi said on an April conference call.

“We remain focused on capital discipline,” he said. “We are absolutely determined at Agnico that increases in gold price go to our owners.”

Agnico is advancing the former Hope Bay gold mine project in Nunavut, where it also operates the Meadowbank and Meliadine gold mines, number three and four in Canada by production. It’s planning a $1 billion underground expansion at Detour Lake that would increase annual output to 1 million oz., making it one of the world’s top-five gold mines.

Upper Beaver

The company expects to give an update in August on developing the Upper Beaver project near Kirkland Lake in northern Ontario as an underground gold and copper mine with a small open pit and processing facility.

In July, Agnico pledged C$93 million for a 9.9% stake in Foran Mining (TSX: FOM), which is advancing the McIlvenna Bay copper-zinc-gold-silver project in Saskatchewan. The major invested C$8.2 million for 13% of First Nordic Metals (TSX-V: FNM) in Finland and boosted its holding in Ontario-focused Maple Gold Mines to 19.9%. 

Barrick Gold (TSX: ABX; NYSE: GOLD) leads our list of Canadian miners by net income at $1.95 billion and is second according to market value at C$44.7 billion.

The company produced 1.9 million oz. gold and 83,000 tonnes of copper in this year’s first half, the company said in July. That compares with 1.1 million oz. gold and 102,058 tonnes copper in last year’s second half, according to its annual report.

Barrick says costs should decline as output increases during this year’s second half. The global miner, which has only the Hemlo mine in Canada, expects increased production at Turquoise Ridge in Nevada after maintenance at the Sage autoclave in the first quarter. It continues to ramp up output at Porgera in Papua New Guinea and posted increases at Tongon in Ivory Coast, North Mara in Tanzania and Kibali in the Democratic Republic of Congo (DRC).

Those increases were partially offset by planned lower production at Cortez and Phoenix in Nevada. Pueblo Viejo production in the Dominican Republic was flat as the miner plans to increase throughput and recovery rates in the year’s second half, it said. 

Mali junta

Barrick is also contending with the junta in Mali that wants more taxes from the Loulo-Gounkoto operation that produced 683,000 oz. of gold last year. Rights groups say the mine is funding Russia because its Wagner Group mercenaries are backing the military government.

“Barrick has been engaging with the National Directorate of Geology and Mines to grow our exploration footprint here, securing our ability to deliver real value to Mali,” CEO Mark Bristow said in July in rare comments since the junta took power a year ago. “We continue to work constructively towards a global resolution of our differences.”

Bristow has a history of working with governments in troubled areas as it develops the $7 billion Reko Diq project in Pakistan after reopening Porgera, both with deals giving locals about half the profit.

Dealmaker

Wheaton Precious Metals (TSX: WPM) is number three in market capitalization at C$37.9 billion and sixth in net income at $538 million. Its streaming and royalties model reduces exposure to operational risks for its own shareholders while offering alternative capital raising for companies that may be thwarted by stock market valuations.

From August last year, the company notched up eight deals valued at more than C$1 billion in potential payments, according to president and CEO Randy Smallwood. He’s targeting 850,000 gold-equivalent oz. of annual production.

Nutrien (TSX: NTR; NYSE: NTR), the world’s largest potash producer, clocks in at number four on both lists, with a market value of C$34.5 billion and net income last year of $1.29 billion. The company said in July it’s reviewing strategic options for its half ownership of Argentine fertilizer company Profertil and said it’s no longer pursuing the $2 billion Geismar clean ammonia project in Louisiana.

Teck Resources (TSX: TECK.B), is sixth on our list of market values at C$32.6 billion after it sold three-quarters of its Elk Valley coal assets to Glencore (LSE: GLEN) and the rest to Nippon Steel of Japan and POSCO of South Korea. Formerly Canada’s largest diversified miner, the company is now focused on copper.

Future growth

Teck doesn’t make our top 13 in net profit for last year, but BMO Capital Markets is upbeat about the company’s future. Teck will be a cleaner investment story as a simplified copper investment vehicle, mining analyst Jackie Przybylowski wrote in a July 15 note.

“Completion of this transaction refocuses Teck as a Canadian-based critical minerals champion,” she said. “The proceeds from the coal sale will fund future growth — either from Teck’s existing portfolio of copper growth options or through acquisition of new assets.”

Cameco (TSX: CCO; NYSE: CCJ) ranked seventh with C$22.7 billion in market value and 10th in net income with $263 million as it rode a uranium price surge that peaked in January at $106 per lb., the highest in 17 years. Lower-than-expected sales hurt first-quarter results, but the company said it expects metal revenue to rebound and its 49%-owned Westinghouse nuclear plant services division to have a stronger second half.

DRC

Ivanhoe Mines (TSX: IVN) in the DRC in July restarted the century-old Kipushi mine which aims to be the world’s fourth-largest zinc producer. The company founded by co-chair Robert Friedland is eighth on the market cap list at C$24.8 billion, and ninth in net income at $303 million.

Also in Congo, the Kamoa-Kakula complex, which holds the world’s fourth-largest copper resource, produced 186,925 tonnes of the wiring and plumbing metal in this year’s first half. It’s ramping up its stage three concentrator capacity this quarter to more than 600,000 tonnes a year. Ivanhoe owns 39.5% of Kamoa-Kakula, which aims to produce 440,000 to 490,000 tonnes of copper in concentrate this year.

The company benefits from United States funding of a rail line across Angola to the Atlantic from the Zambia-DRC copper belt. The company, metals trader Trafigura and Angola are considering a 2,000-megawatt high-voltage line from northern Angola hydro-electric plants to the copper region.

Anglo announced the restructuring strategy in May after successfully fending off a $49 billion takeover bid from BHP (ASX:BHP), the world’s largest mining company. The 18-month plan focuses on exiting diamond mining by divesting its De Beers unit, separating its platinum operations, and selling its coal mines.

The company attributed the impairment at Woodsmith to a decision to “temporarily slow down” development of the project, which Anglo rescued from collapse four years ago. Anglo took a $1.7 billion hit last year due to a prolonged timeline and higher costs at the mine, which will produce polyhalite — a new type of organic fertilizer that has not yet been tested at scale.

Regarding its coal assets, the company will conduct a two-stage auction process, which has been delayed by a major fire at the Grosvenor mine. Anglo said the Queensland, Australia asset would probably only resume operations under a new owner.

“We are transforming Anglo American by focusing on our world-class asset base in copper, premium iron ore and crop nutrients,” chief executive Duncan Wanblad said in the statement. “As we progress our portfolio transformation, we expect to substantially reduce our overhead and other non-operational costs in phases, but weighted towards the end of the process to minimize business risk.”

Core divisions excel

Revenue in the half year to June 2024 fell by 8% to $14.5 billion while underlying profits were down by 23% to $1.29 billion. Net losses were $672 million, compared to a profit of $1.26 billion a year ago.

About 70% of the earnings came from copper and iron ore, the two divisions Anglo is keeping, along with Woodsmith.

Wanblad said he was “very encouraged” by the company’s “strong” operational performance. “[We] delivered steady volumes and a 4% improvement in unit costs, while still facing weak cyclical markets for platinum group metals and diamonds,” he said.

The results beat analyst consensus forecast thanks to a stronger-than-expected performance from the copper division. The interim dividend of $0.42/share was also higher than market estimates by 9%, BMO metals and mining analyst Alexander Pearce wrote on Thursday. 

“All things considered, this appears to be a positive set of results from Anglo,” said Christopher LaFemina, analyst at Jefferies. Still, there are “relatively high risks associated with the company’s proposed restructuring plan,” he noted.

The company reiterated 2024 production and cost guidance for most of the portfolio, but lowered De Beers’ expected production for the second time this year to 23-26 million carats from 26-29 million carats previously.

The world’s biggest miner noted that phase two was now underway with the project on track to reach first production in 2026, with expected potash output of 4.2 million tonnes a year.

BHP said the focus will now be on completing the mill building, processing plant and port construction, all while finalizing infrastructure and preparing to transfer the project to operations.

“Building one of the largest potash mines in the world requires an all-hands-on-deck approach, and the province has really come together to make a project of this magnitude possible,” BHP’s potash president, Karina Gistelinck, said in the statement.

Construction of Jansen’s second phase is expected to take six years and deliver first production in 2029. The company has said this stage needs an investment of C$6.4 billion ($4.9 billion).

Located 140 km east of Saskatoon, the Jansen project is set to become one of the world’s largest producers of potash, a commodity considered to be a pillar of future growth for the company. It also represents the single largest private economic investment in the province’s history.

Since giving the project its go-ahead in August 2021, BHP has been injecting capital to speed up its development even when potash prices were falling. Even before its approval, the group had spent $4.5 billion on the project.

The proposed potash mine is being built in four stages, with $5.7 billion already spent on the first stage alone. In October last year, BHP announced plans to expand the Jansen project, approving a further $4.9 billion investment for stage two. This brings BHP’s total investment in Jansen to date to about C$14 billion ($10bn).

BHP anticipates that Jansen will become one of the world’s largest potash mines, producing 8.5 million tonnes per annum and boosting global production by an estimated 10%.

Potash is part of Canada’s critical minerals list due to its importance as a key soil nutrient, essential for ensuring global food security. Australia has not yet classified potash as a strategic mineral.

The company announced the restructuring in May amid a successful rebuttal of a $49 billion takeover approach from BHP (ASX: BHP), the world’s biggest miner. 

The plan includes a sale or divestment of its 85% stake in De Beers, the world’s largest diamond producer by value, to focus on copper, iron ore and the Woodsmith fertilizer project in the UK.

Anglo American lowered its full-year diamond guidance in April to between 26 million and 29 million carats. While it has decided to maintain the current target at De Beers, it revealed it is simultaneously exploring options to further reduce output. 

This would add to already implemented production cuts of about 10%, which resulted in second-quarter output falling 15% year on year to 6.4 million carats, the company said on Thursday, announcing second quarters results. Production for most of the other commodities the company mines beat consensus analyst forecasts.

Chief executive Duncan Wanblad noted that diamond trading conditions have become more challenging in the second quarter as Chinese consumer demand remained weak.

“With higher than normal levels of inventory remaining in the midstream and an expectation for a protracted recovery, we are therefore actively assessing options with our partners to further reduce production to manage our working capital and preserve cash,” he said.

Anglo American would prefer to wait for an improvement in the diamond market before making any major changes, as it believes that De Beers should be able to command a price that reflects its status as a legacy asset. 

The expected market recovery is not showing much progress at this time, as on top of low demand from China, lab-made gems and inflation-hit consumers continue to add the sector’s challenges.

Shining bright for 136 years

De Beers was founded in 1888 in South Africa by British mining magnate Cecil Rhodes. The company was partially owned by the Oppenheimer dynasty, which also founded Anglo American, until the family sold their 40% stake to Anglo American itself in 2012.

The diamond producer used to be the prized possession of Anglo’s extensive business empire. It held a dominant position in the global precious stones market in terms of both overall sales and public perception, due to the long-lasting impact of its “A diamond is forever” campaign from the 1940s.

De Beers is targeting annual core profits of $1.5 billion by 2028. Last year, the business made just $72 million, though traditionally its profits have ranged between $500 million and $1.5 billion as the diamond industry swings from boom to bust.

The diamond miner seems ready to fly alone as it did for 124 of its 136 years of existence. Anglo American acquired a majority stake in De Beers only 13 years ago.

The government of Botswana holds the remaining shares and recently stated it would increase its stake in the company in order to play a central role in selecting a new investor to replace Anglo.

Wanblad restated his goal of finishing the majority of Anglo’s streamlining process within the next 18 months.

Never has this old business school adage been truer than for NVIDIA. The California-based company’s market worth has skyrocketed as companies rush to buy its graphics processors to power artificial intelligence projects. 

Nevertheless, it’s jarring to see the companies doing the actual shovelling be appraised by the market in such a contrasting way.

The MINING.COM ranking of the 50 most valuable mining companies shows a combined value of $1.4 trillion at the end of the second quarter, not even half that of NVIDIA.    

There is another maxim from the mining industry: If it can’t be grown it has to be mined. 

Looking at this chart, that’s clearly not something often mentioned in investment circles.

Gold and copper’s historic runs to new all-time highs in May arguably should have sparked a bigger rally during the quarter and year-to-date but mining’s top tier is only worth little over 2% more than at the end of last year and an equally uninspiring 6% gain from this time last year.

Diversified drubbing

Copper specialists have gained a combined 33% year to date but the industry’s traditional big 5 – BHP, Rio Tinto, Glencore, Vale and Anglo American – have lost a collective $59 billion since the start of the year. 

The boost from copper was also not enough to counter iron ore’s descent into bear territory from dragging down the group, which now make up 29% of the total index, down from a height of 38% at the end of 2022.  The steelmaking ingredient’s less than rosy outlook also sees two specialists – Cleveland Cliffs and Fortescue – appear in the worst performer list.

Were it not for Glencore’s lack of exposure to iron ore other than through trading, steadying the Swiss giant’s share price, and Anglo American’s 25% jump during the quarter on the back of BHP’s unsuccessful takeover bid, mining’s traditional heavyweights would be an even more diminished grouping.   

Investors in Anglo, with a history going back more than a hundred years on the South African gold and diamond fields, have had a particularly wild ride over the last few years. In January 2016, Anglo’s market cap fell below $5 billion and even after the stock’s Q2 bump, is still only worth half its peak valuation hit in 2022.

While the BHP takeover is unlikely to be revived, M&A among the top of the mining industry seems inevitable, particularly when copper is involved, given the billions of dollars of capital expenditure needed for expansion and just to keep operating mines ticking over, to meet demand for the metal through the next decade.   

Light on lithium 

Three counters dropped out of the top 50 during the first quarter – Brazil’s CSN Mineração, an iron ore miner, China’s Huayou Cobalt and Australian lithium producer Pilbara Minerals. 

At the end of Q2, two more lithium stocks – Perth-based Mineral Resources and China’s Tianqi Lithium – exited the top 50 as the deep slump in prices for the battery metal continues to take its toll.  

Mineral Resources was only just pipped by Ganfeng Lithium and based on its performance so far in July, the Australian hard rock lithium miner may well return to the fold.

Ganfeng was barely holding on at position 50 at end-June and with gold price momentum continuing and two gold mining companies waiting in the winds – Yintai and Alamos – only three lithium counters in the top 50 may be a reality for some time to come. 

After peaking in the second quarter of 2022 with a combined value of nearly $120 billion, the remaining lithium stocks’ market value now barely exceeds $30 billion.  

Can’t top copper  

Copper, gold producers and royalty companies made up 40% of the index at the end of Q2 on par with diversified miners as Pan American Silver, following its absorption of Yamana Gold enters the ranking for the first time and Polish copper giant KGM returns after adding 17% to its market cap during the quarter. 

Talks of a possible reopening of its Panama mine saw First Quantum Minerals’ market valuation nearly doubling in US dollar terms from its low at the end of last year, and the Vancouver-based company is now firmly back in the ranking at #34 after dropping out at the end of last year. 

Amman Mineral continues its run up, piercing the top 10 for the first time after gaining 67% year to date, and 580% since its debut in Jakarta a year ago, lifting the copper-gold company’s market cap to over $50 billion. 

Amman’s Batu Hijau is the third largest mine worldwide in terms of copper equivalent output and has been in production since the turn of the millennium. Amman is also developing the adjacent Elang project on the island of Sumbawa. 

Radiant uranium

While spot uranium prices have retreated back below the triple digit prices hit in January, the combined market cap of the sector is still up 42% from last year this time and together now surpasses that of the lithium counters in the ranking. 

The world’s largest uranium producers – Cameco and Kazatomprom – only made the top 50 in 2021 with the Saskatoon-based company and state-owned Kazakh producer spending years in the wilderness post the Fukushima disaster in Japan. 

None of the smaller uranium companies led by Canada’s Nexgen Energy, valued at a shade over $4 billion, is likely to make it into the top 50 by themselves, but combinations among the rank and file may well be in the offing as interest in the sector and mining M&A in general grows.

Kazatomprom dual-listed in London and Astana in 2018 and Uzbekistan is readying an IPO for Navoi Mining and Metallurgy Combinat – the world’s fourth largest gold mining company and significant uranium producer later this year. 

Navoi would join the ranks of gold producers in the top 50 thanks to ownership of the world’s largest gold mine, Muruntau, and annual production of 2.9 million ounces at grades the envy of the sector.  Navoi will also bring to five the number of companies with exposure to the nuclear fuel in the ranking.

Notes:

Source: MINING.COM, stock exchange data, company reports. Share data from primary-listed exchange at close July 1, 2024 close of trading converted to US$ where applicable. Percentage change based on US$ market cap difference, not share price change in local currency.  

As with any ranking, criteria for inclusion are contentious. We decided to exclude unlisted and state-owned enterprises at the outset due to a lack of information. That, of course, excludes giants like Chile’s Codelco, Uzbekistan’s Navoi Mining (the gold and uranium giant may list later this year), Eurochem, a major potash firm, and a number of entities in China and developing countries around the world.

Another central criterion was the depth of involvement in the industry before an enterprise can rightfully be called a mining company.

For instance, should smelter companies or commodity traders that own minority stakes in mining assets be included, especially if these investments have no operational component or warrant a seat on the board?

This is a common structure in Asia and excluding these types of companies removed well-known names like Japan’s Marubeni and Mitsui, Korea Zinc and Chile’s Copec. 

Levels of operational or strategic involvement and size of shareholding were other central considerations. Do streaming and royalty companies that receive metals from mining operations without shareholding qualify or are they just specialised financing vehicles? We included Franco Nevada, Royal Gold and Wheaton Precious Metals on the basis of their deep involvement in the industry.

Vertically integrated concerns like Alcoa and energy companies such as Shenhua Energy or Bayan Resources where power, ports and railways make up a large portion of revenues pose a problem. The revenue mix also tends to change alongside volatile coal prices. Same goes for battery makers like China’s CATL which is increasingly moving upstream, but where mining will continue to represent a small portion of its valuation.  

Another consideration is diversified companies such as Anglo American with separately listed majority-owned subsidiaries. We’ve included Angloplat in the ranking but excluded Kumba Iron Ore in which Anglo has a 70% stake to avoid double counting. Similarly we excluded Hindustan Zinc which is listed separately but majority owned by Vedanta.

Many steelmakers own and often operate iron ore and other metal mines, but in the interest of balance and diversity we excluded the steel industry, and with that many companies that have substantial mining assets including giants like ArcelorMittal, Magnitogorsk, Ternium, Baosteel and many others.

Head office refers to operational headquarters wherever applicable, for example BHP and Rio Tinto are shown as Melbourne, Australia, but Antofagasta is the exception that proves the rule. We consider the company’s HQ to be in London, where it has been listed since the late 1800s.

Please let us know of any errors, omissions, deletions or additions to the ranking or suggest a different methodology.

The Canadian government will only approve foreign takeovers of large Canadian mining companies involved in critical minerals production “in the most exceptional of circumstances,” according to the latest guidelines from Industry Minister Francois-Philippe Champagne. The directive issued on Thursday is part of a sweeping effort by Prime Minister Justin Trudeau’s government to protect Canada’s critical minerals sector and national security interests.

The move appears to insulate domestic companies from takeovers when the world’s biggest mining firms are hunting for metals that underpin the global transition away from fossil fuels. Industry giants such as Glencore Plc, BHP Group Ltd. and Rio Tinto Plc have been seeking to boost exposure to metals like copper as the appetite for large, transformational deals returns across the industry.

Canadian mining firms, in turn, have become appealing targets. Teck Resources Ltd. spent much of last year fending off Glencore’s $23 billion takeover attempt before the Swiss company opted instead to just buy the company’s steelmaking-coal business. The federal government approved the $6.9 billion deal on Thursday, while also setting new criteria for future foreign mining deals.

Canada and its Western allies have become increasingly concerned about securing critical minerals needed for goods ranging from electric vehicle batteries to electronics, prompting them to push to develop supply chains to loosen China’s global dominance over the industry.

“This high bar is reflective of the strategic importance of Canada’s critical minerals sector and how important it is that we take decisive action to protect it,” Champagne said in a statement. The government’s list of 34 critical minerals includes copper, zinc, potash and uranium.

A spokesperson for the government declined to comment further on what might constitute exceptional circumstances for transactions. The Mining Association of Canada declined to comment on the new directive.

Foreign takeovers of mining companies have been a touchy topic in Canada ever since a wave of deals 18 years ago took out some of the country’s biggest players, including nickel miner Inco Ltd. and aluminum producer Alcan Inc. When BHP proposed a takeover of Potash Corp. of Saskatchewan Inc. in 2010, then-Prime Minister Stephen Harper’s government blocked the deal on the grounds it wouldn’t be of “net benefit” to the country.

Teck is one of the few large Canadian metals producers that survived a wave of industry takeovers, even though it has long been coveted by foreign competitors for its copper and zinc assets spread across the Americas. The Vancouver-based company is widely expected to become an acquisition target when founder and top investor Norman Keevil gives up control of the company in the coming years.

“Essentially they are saying to Glencore, don’t bother coming back for the other half of Teck,” said Canadian mining financier Pierre Lassonde, who launched a competing bid for Teck’s coal assets last year. “It looks to me like Ottawa is prepared to ring-fence the Canadian critical metals industry with this new directive.”

Bloomberg has reported previously that Rio Tinto had looked in the past at Canadian copper miner First Quantum Minerals Ltd., among other potential deals, although Rio chief executive officer Jakob Stausholm had so far rejected the idea.

Other big Canadian miners include fertilizer producer Nutrien Ltd. and uranium giant Cameco Corp., in addition to Ivanhoe Mines Ltd., which has large copper and zinc operations in the Democratic Republic of Congo.

The new directives go even further than a crackdown on foreign takeovers from state-owned entities that began in October 2022. Champagne’s ministry has thwarted several recent attempts by Chinese companies to make inroads in Canada’s critical minerals sector through takeovers or major investments. But Thursday’s comments signal that the federal government is wary of foreign takeovers even from companies in friendly nations.

Canada’s crackdown could also constrict access to capital for companies that rely on foreign investment to fund exploration and mining projects. The government is “limiting” funding to the industry with their “more aggressive statements,” said Shane Nagle, a metals and mining analyst with National Bank of Canada. “If that’s going to be challenging to do, they’ll just go elsewhere.”

(By Jacob Lorinc)

The move, according to sources quoted by AFR, comes as BHP failed to meet its internal performance targets.

The company’s management attributed the reduction to failures in meeting cost and production goals in certain divisions, along with an incident that cost the life of a worker at its Saraji coal mine in Queensland in January, according to the article.

“The docking of incentives has upset some BHP employees who contacted the Australian Financial Review pointing to hiring freezes in some divisions that impacted the ability to hit targets and what they see as unrealistic internal goals,” the report said.

This is not the first time BHP has trimmed employee incentives across the globe. In 2019, the company reduced them by 20% due to a number of operational mishaps, such as a train derailment in Western Australia in November 2018 and a fatality – also at the Saraji coal mine – a month later.

Then chief executive Andrew Mackenzie saw his annual pay shrink by almost a quarter by the end of 2019, after other issues, including equipment failures at the Olympic Dam in South Australia and Escondida mines in Chile. 

Last year, CEO Mike Henry promised to step up safety measures across all operations following yet more fatalities.

BHP reported in February that profits for the first half of the year were impacted by a $2.5 billion impairment charge associated with its nickel business in Western Australia and a further another $3.2 billion in payments related to the Samarco dam disaster in Brazil.

The company revealed that it had disbanding certain global corporate teams as part of its cost-cutting measures.

“We’re getting back at least to a market that we would call stable,” Nutrien Ltd. chief executive officer Ken Seitz said Wednesday in an interview at Bloomberg’s headquarters in New York.

Black Swan-like events — unanticipated calamities that pull markets into a tailspin — upended the typical cycles of the market, the CEO said. Russia’s 2022 invasion of Ukraine disrupted global fertilizer shipments and pushed prices — and Nutrien earnings — to record heights. But as farmers and retailers balked at the sticker shock, demand tumbled.

Nutrien and its rivals have been predicting better market conditions over the past several quarters that so far have yet to materialize. The Canadian company’s earnings plunged 71% in the first quarter. Its shares, meanwhile, have tumbled more than 50% from a record in April 2022, shortly after Russia’s invasion of Ukraine.

“We are looking at demand that is after a very volatile period, with some demand destruction, that is only today returning to sort of trend levels,” Seitz said, noting that fertilizer prices today are below the 10-year average.

Nutrien has responded by scrapping big investment plans and putting some assets up for sale in South America as it focuses on restoring growth.

While some earlier supply disruptions have eased, shipping remains a challenge amid the ongoing crisis in the Red Sea region. Trade routes for fertilizer have been dramatically rerouted as some nations are willing to take products from sanctioned countries.

Brazil in particular has been a sore spot for Nutrien. Fears of supply shortages because of disruptions in Eastern Europe first led to an overbuilding of fertilizer inventories in the country. But surging interest rates in Brazil have made the glut even more challenging to manage. Farmers are now opting for just-in-time purchases, Seitz said, adding that a pesticide glut will take the remainder of this year and possibly into 2025 to be resolved.

In Argentina, Nutrien is working to sell its agriculture retail operations and is considering options for its 50% interest in Profertil SA, a urea and ammonia manufacturing venture it has with Argentina state-run oil company YPF SA. If Nutrien ends up selling the stake along with the retail businesses, it will join a slew of other major companies exiting the South American country.

The challenge of repatriating dollars is a key problem because of Argentina’s currency controls, according to the CEO. Nutrien lost money when it transferred currency out of the country because it had to use a more expensive exchange rate.

“I wouldn’t say that we are clamoring to get out of Argentina, we’re just being very thoughtful about our strategic options there,” Seitz said. However, he added that “we don’t see any indication that anything is going to change” under the new administration of President Javier Milei.

In the US, farmers have raced to wrap up corn and soybean planting after a soggy spring. Seitz has estimated the US will plant about 90 million acres of corn and 86.5 million acres of soybeans, though corn “could be a little less” given recent weather challenges, he said.

The US Department of Agriculture is set to release its yearly acreage report on Friday.

While the prospect of fewer corn plantings could impact applications of the nitrogen fertilizer used to grow the grain, Seitz noted there could be ample use of nitrogen in the mid- and post-growing season, and he sees no reason to change the company’s nitrogen sales guidance of 10.6 million tons to 11.2 million tons.

While crop prices have fallen, so have farm input costs, at a time when grower incomes remain healthy, according to Seitz.

“All indications are that farmers are looking as usual to maximize yields,” he said.

(By Kim Chipman and Gerson Freitas Jr.)

Lac à Paul in the Saguenay-Lac-Saint-Jean region about 450 km north of Quebec City has a projected annual production capacity of 350,000 tonnes of phosphorus pentoxide (P₂O₅), Arianne said on Thursday. The company told The Northern Miner by email it wasn’t publishing after-tax figures, only pre-tax, which came in with a net present value of $4.5 billion at an 8% discount rate. The pre-tax internal rate of return is 32.8% with a payback of roughly three years.

“The advent and growth of the lithium iron phosphate (LFP) battery provides extremely compelling economics,” Ariane president Brian Ostroff said in a release. “The study also demonstrates the opportunity for our Lac à Paul mine to have a local customer.”

PPA is a crucial agricultural commodity for enhancing crop yields and meeting global food demand. North and South America, Western Europe and parts of Asia face shortfalls and rely on imports to satisfy growing demand. While about 85% of phosphate is currently used in fertilizers, emerging technologies like LFP batteries are driving additional demand. Canada added phosphorous to its critical minerals list this month.

Sales revenue

The project’s $1.7 billion construction forecast includes a contingency of about $240 million. Operating costs are estimated at $1,195 per tonne. The company expects annual sales of $1.1 billion. That’s from 350,000 tonnes of PPA priced at $2,300 per tonne, 220,000 tonnes of secondary acid at $1,200 per tonne, and three million tonnes of byproduct gypsum at $10 per tonne. Surplus electricity generated could be sold to the grid, although this revenue isn’t factored into the project’s financial model.

Industry analysts predict a significant PPA shortage by the end of the decade due to increased demand from both traditional food additives and the surging LFP battery sector. Arianne’s facility would also produce 220,000 tonnes annually of secondary phosphoric acid used in specialty fertilizers and animal feeds. This market segment is also facing constraints as current producers limit output due to operational challenges, Arianne said.

Regional benefits

The company expects to create 1,000 jobs and contribute $12 billion in economic benefits to the region. The Lac à Paul project boasts a resource base capable of supporting production for over 50 years. It has proven and probable reserves of 472.1 million tonnes grading 6.88% P₂O₅, along with 702.7 million measured and indicated tonnes at 7.16% P₂O₅ and 26 million inferred tonnes at 6.58% P₂O₅.

Shares in Arianne Phosphate closed 14% higher on Friday in Toronto at C$0.28 apiece, valuing the company at C$58 million. The stock has traded in a 52-week range of C$0.18 to C$0.31.

“The opportunity is here for the Saguenay to become a major player in the essential phosphoric acid industry,” Arianne COO Raphael Gaudreault said in the release. “The project checks so many boxes; security of supply, easy logistical access to a critical mineral, minimal operational challenge and very impressive economics.”

The experts say that mining and energy companies need to rethink traditional capital delivery models, as a way to avoid costs and timeline blowouts.

Examples abound, with some of the most recent and noteworthy being Horizonte Minerals’ (LON, TSX: HZM) Araguaia nickel project in Brazil’s Amazon region. The company was put into administration last month after it failed to secure financing to finish building the $1-billion project. Costs had almost doubled from the previous estimate of $537 million.

Another case in point is Teck Resources’ (TSX: TECK.A, TECK.B) (NYSE: TECK) Quebrada Blanca copper project in Chile. The Canadian miner spent much of 2023 fighting off a hostile approach from Glencore (LON: GLEN), last said its Quebrada Blanca 2 project would cost between $8.6 billion and $8.8 billion, compared with an original $5.3 billion estimate.

As part of the actions suggested, the authors highlight the need to adopt a systematic portfolio thinking. “Leading companies are beginning to view their projects as part of an aggregated system rather than in isolation,” the report says. By doing so, they can capture synergies and build resilience across their entire portfolio.

Bain and Co. also call companies to realign operating models. This, the experts say, would ensure that critical decisions are made with a broader perspective, addressing the blind spots that often occur in siloed organizational structures.

The adoption of digital solutions, automation, and AI tools is proving to be a game-changer for capital projects. In their research, Bain and Co. Found that these technologies help eliminate waste and reduce friction, delivering immediate efficiencies and streamlining project management processes.

Tech efficiency

By thinking systematically across portfolios, realigning operating models, and embracing digital technology, mining and energy companies can mitigate risks and ensure more reliable project outcomes.

The experts believe the future of project management for the sector lies in integrated, technology-driven strategies that enhance efficiency and resilience, ensuring sustainable growth and success in an increasingly competitive landscape.

Anglo’s unit Crop Nutrients was holding a town hall meeting on Thursday to advise on the slowdown of the project in North Yorkshire, two sources said. Woodsmith currently gives work to around 2,000 people, including contractors, according to the mining company’s website.

“We urge (Anglo) to pause and properly consider the catastrophic impact that losing so many high quality jobs could have on our area,” said Roberto Weeden-Sanz, the conservative party’s candidate for Scarborough and Whitby.

“Local people have supported this fantastic project for many years and it should not be used as a sacrificial lamb to fend off a takeover from a bigger company,” he added.

Anglo says on its website that since construction started in 2017, Woodsmith has generated £1.5 billion ($1.91 billion) to the economy of Yorkshire and the North-East of England.

“We are slowing down the development of the project while we strengthen our balance sheet, albeit still investing,” Anglo said in an emailed comment. “Once the conditions are right, we will ramp up again and fulfil Woodsmith’s potential as a multi-generational mine.”

“Unfortunately we do expect jobs to be affected and we will be working through that and consulting our employees to provide as much clarity as quickly as we can,” it added, without giving details on numbers.

Anglo has been looking for partners for Woodsmith for around six months, chief executive Duncan Wanblad told Reuters on May 16, reiterating the business will be one of three pillars of the revamped miner, even as it slowed its development, pushing back first production from 2027.

The decision to stall the project is part of a radical plan announced earlier this month to divest or sell assets following a 94% plunge in annual profit.

“Anglo should not be rushing into decisions that put the livelihoods of hard working and highly skilled Teessiders at risk,” said Ben Houchen, mayor of the Tees Valley. “We want to hear from Anglo directly and for them to engage with government to make sure every option is considered before drastic measures are taken.”

Woodsmith, on which Anglo announced a $1.7 billion writedown a year ago, has the world’s largest known deposit of polyhalite, a naturally-occurring mineral containing nutrients including potassium, calcium, magnesium and sulphur, which it is marketing as POLY4.

A feasibility study for the project is only expected to be ready by the beginning of 2025. This would have been followed by a board full notice to proceed in the first half of the year if the wider assets’ restructuring had not got in the way.

Analysts estimated total spending on Woodsmith at around $9 billion. Anglo said it has invested around £3 billion in it so far.

($1 = 0.7865 pounds)

(By Clara Denina; Editing by Susan Fenton)

“BHP will not be making a firm offer for Anglo American,” chief executive Mike Henry said in a statement published minutes before the 5 p.m. UK time deadline for the mining giant to make a formal bid. “While we believed that our proposal for Anglo American was a compelling opportunity to effectively grow the pie of value for both sets of shareholders, we were unable to reach agreement with Anglo American on our specific views in respect of South African regulatory risk and cost,” Henry noted.

Anglo said after markets closed the company had set out “a clear pathway” to accelerate delivery of its strategy and “to unlock significant value” for its shareholders. “Our shareholders will benefit from value transparency and undiluted exposure to a simpler portfolio of world class assets,” chairman Stuart Chambers said.

Anglo’s refusal earlier in the day argued that BHP had failed to address its concerns over the “highly complex and unattractive structure” of the proposed deal. 

Analysts had warned that Anglo’s denial of BHP’s requested deadline extension indicated the mega deal was likely to be cancelled. RBC said in a note to investors on Wednesday the proposed $49.2 billion (£38.6bn) takeover structure is too complex for BHP to go hostile. 

“If BHP doesn’t launch a formal bid, it will be barred from buying Anglo for six months, unless a competing offer emerges,” they wrote.

The mining giants had been in talks since May 22, when Anglo rebuffed BHP’s third bid, with the parties focused on finding a deal structure satisfactory to both. 

BHP proposed a complicated transaction scheme, which remained the main bone of contention in the past five weeks of negotiations.

Anglo argued that the requirement to first spin off its majority stakes in two South African miners created excessive risk for its own investors, who would end up holding those shares. The target company wanted the suitor to either alter the structure of the proposal or compensate its shareholders for any loss of value as a result of the spinoffs.

BHP had said the risks associated with its takeover plan were “quantifiable and manageable”, adding that the costs of the proposed measures had already been incorporated into its offer.

“We remain of the view that our proposal was the most effective structure to deliver value for Anglo American shareholders, and we are confident that, working together with Anglo American, we could have obtained all required regulatory approvals, including in South Africa,” Henry said.

All about copper

BHP’s main interest in targeting Anglo was its copper mines. An electrified world has become increasingly dependent on battery metals, particularly on copper, and BHP was, not surprisingly, eager to secure a leading position in this market. A tie-up would have given the mining giant about 10% of global copper production at a time when copper prices are hitting record-highs. They have climbed about 23% so far this year.

A successful deal not only would have reshaped the mining industry, but would have also boosted BHP’s presence in the world’s top copper producing countries, Chile and Peru. This would have made it the world’s largest producer of the metal, far surpassing Codelco.

Anglo American, which traces its roots in South Africa to its founding 107 years ago, has come up with its own sweeping break up plan. This includes keeping its copper and iron ore assets, the two most profitable units, and reducing investments in its Woodsmith fertilizer project in northern England. Despite some investors urging Anglo to shelve or offload the project, the company is not ready to part ways with it. Instead, it plans to find strategic investors who can support the resumption of full-scale operations at Woodsmith starting in 2026.

BHP’s concessions

BHP had made some concessions to Anglo, hoping to reach an agreement. They included keeping Anglo’s office in Johannesburg fully staffed and listing BHP shares on the South African market. The company also mentioned its willingness to contribute to a potential increase in South African employee ownership of the two units, if it was necessary. These measures would have been upheld for a minimum of three years following the completion of the takeover. 

Henry also expressed openness to negotiating a break fee in the event that regulatory authorities, including those in South Africa, block the potential deal.

According to UK regulations, BHP must now wait at least six months before thinking of approaching Anglo American again.

IMII is a non-profit organization jointly funded by industry and government to develop and implement innovative education, training, research, and development partnerships to support the minerals industry.

ORES will automate the sampling process of potash, uranium, and other ores, providing comprehensive, real-time analysis of ore composition and quality, Metaspectral said. The technology uses artificial intelligence (AI) to analyze data from hyperspectral sensors placed along conveyor belts that move the ores, allowing for continuous, non-contact, non-destructive analysis.

“Our integrated software platform can provide immediate information to operators about ore quality and composition. This can guide early decision-making in the milling process and make it possible to identify and select only ores of a predetermined grade for processing,” CEO Francis Doumet said in a media statement.

“Enabling the selective processing of ores makes it possible to reduce costs and lessen environmental impact, using less water and energy, while producing fewer tailings and less waste.”

This comprehensive level of analysis is not possible using traditional methods of ore sampling, which only analyzes a single point on the sample, the Vancouver-based company said.

ORES, conversely, captures complete data about the materials when the ore passes by the spectral sensors on a conveyor belt. These sensors capture hyperspectral data, which measures photon interactions to produce unique spectral signatures that can be interpreted to uncover detailed information about the properties of the ore at the molecular level.

This high level of detail has significant potential to improve the mining sector’s operational efficiency and profitability while lessening its environmental impact, the company said, adding that the technology can also help to reduce the need for human exposure to ores, which can enhance worker safety.

Metaspectral’s technology has been validated and is already deployed commercially in other sectors, including plastics recycling. A similar conveyor belt configuration has achieved identification accuracies exceeding 92% at high speeds for difficult-to-sort materials such as thin plastic film, black material, and transparent material by polymer type, the company said.

BHP now has until May 29 at 5pm GMT time to table a binding bid for its smaller rival, which is simultaneously working on a radical business overhaul that will see it divest its less profitable coal, nickel, diamond and platinum units.

The latest, already rebuffed offer valued Anglo American’s shares at £29.34 based on the April 23 closing price. The figure represents a 47% premium on the stock value, BHP said.

“BHP has put forward a final offer that would provide Anglo American shareholders with 17.8% of a combined BHP and Anglo American,” chief executive Mike Henry said.

“The revised proposal is underpinned by BHP’s disciplined approach to mergers and acquisition and our focus on delivering long term fundamental value,” Henry noted.

Anglo American said its board continued to have serious concerns with the structure demanded by BHP, as “it is likely to result in material completion risk and value impact that disproportionately falls on Anglo American’s shareholders,” it said.

BMO analyst Alexander Pearce noted that while BHP’s third offer isn’t a formal one, and it has already been rejected, the deadline extension would suggest that there is an “increased likelihood” that a deal can be reached between the two companies.

“The revised offer ratio is already at the top end of what BHP could pay to avoid dilution on an earnings before interest, taxes, depreciation, and amortization (EBITDA),” Pearce wrote in a note to investors on Wednesday.

Earlier in the day, South African state-owned asset manager the Public Investment Corporation (PIC), which is Anglo American’s second largest investor, asked the target company to perform a “meaningful revision” of BHP’s proposals.

South African state-owned asset manager the Public Investment Corporation (PIC), which owns shares in both miners, said any proposal by BHP should reflect “the embedded value of existing Anglo assets” as well as the potential future benefits the bidder can gain, particularly from the target company’ unlisted assets.  

“This would require a meaningful revision of the current BHP proposal that should take into consideration the material risks that current shareholders of both Anglo and its subsidiaries would have to assume,” the PIC said in the statement.

“The PIC recognizes the positive impact of Anglo American in the South African economy and the region at large, and the company’s role in this regard should not be diminished as a result of the proposed offer by BHP,” it said. 

Anglo American has twice rejected BHP’s approach, which would imply for Anglo to spin off its stakes in two South African iron ore and platinum companies before being acquired. 

After rebuffing the latest offer, Anglo American’s chief executive Duncan Wanblad unveiled his own plan to reshape the business, which includes exiting platinum, diamonds and coal and slowing the unpopular Woodsmith fertilizer project.

BHP has until 1600 GMT today to make a binding offer or it will be forced to walk away for at least six months. If the parties reach an agreement before that, an extension can be granted.

The death took place at the railcar-loading facility at Nutrien’s mine near the town of Rocanville, about 250 km (150 miles) east of the provincial capital Regina.

Potash is a primary ingredient in agricultural fertilizers.

In a statement the company said it is conducting an internal investigation and is cooperating with authorities.

“Our current focus is on ensuring we have support services available to all those involved,” the statement said, adding that the company is “unlikely to have further details until the completion of internal and external investigations.”

(By Anna Mehler Paperny; Editing by Cynthia Osterman)

SDIC aims to acquire up to 49% of the company, which has exploration and production rights in northeast Thailand, from Italian-Thai Development Pcl, the people said, asking not to be identified discussing confidential information.

A deal could be worth at least $400 million and might be announced as soon as the coming weeks, the people said. No agreement has been finalized and talks could still fall apart, they said.

ITD, as Italian-Thai Development is known, Asia Pacific Potash and SDIC didn’t respond to requests for comment.

ITD shares jumped as much as 11%, the biggest gain in three weeks.

Bloomberg News reported in February that ITD was considering selling its 90% stake in Asia Pacific Potash and talking with potential buyers, including from China. In April, ITD’s executive vice president reaffirmed that talks were ongoing and asset sales would accelerate as the builder tries to repay debts.

While ITD is still one of Thailand’s biggest construction firms, its market value has tumbled to a little over $100 million from more than $1.5 billion less than 10 years ago. Net income for the first quarter was about 122 million baht ($3.4 million), down 60% from a year earlier, the company said last week.

After reporting a fourth-straight annual loss in March, ITD said it expected to get new loans and sell non-core assets to continue operations and address a liquidity crunch. Bondholders also approved two-year extensions of redemption dates in January. ITD’s total liabilities were 107 billion baht as of Dec. 31.

ITD acquired Asia Pacific Potash in 2006, giving it access to high-grade potash deposits in Thailand’s Udon Thani province, where it has annual production capacity of 2 million tons, according to its website.

SDIC Mining is a subsidiary of China’s State Development and Investment Corp., which invests in non-coal mineral resources and related industries.

(By Dong Cao, Elffie Chew and Anuchit Nguyen)

The Woodsmith fertilizer mine and surrounding area in Yorkshire have found themselves in the middle of one of the biggest takeover battles of recent years involving a British company: BHP Group Ltd.’s attempted purchase of rival Anglo American Plc. And whoever ends up prevailing, the $9 billion project already looks like collateral damage.

After rejecting BHP’s overtures, Anglo has been under pressure to slash costs and slim down its sprawling portfolio to keep its shareholders onside. The miner said this week it will scale back the amount of money it plans to spend on the Yorkshire mine, which employs about 2,000 people adjacent to an area with some of the UK’s highest unemployment.

The project faces just as much uncertainty if BHP succeeds with its £34 billion ($43 billion) approach. The Australian company is already building its own giant fertilizer facility in Canada to the tune of more than $10 billion.

“It’s very worrying,” said Neil Swannick, a local councilor who along with his colleagues is in a liaison group with Anglo. “The mine was going to bring wealth and economic activity to the area, which is historically a low pay area.”

A spokesperson for Anglo said it’s early days and it’s not clear how many jobs are in jeopardy, 1,400 of which are in the local community. The company is working out the full details of what the slow down at the mine means.

There’s no doubt that Woodsmith is staggeringly expensive. Anglo has been spending about $1 billion a year on it. Capital expenditure will now be cut to about $200 million next year, and nothing in 2026, as it looks for outside partners to invest. The mine was due to open in 2027. That’s now been pushed back indefinitely.

Anglo’s purchase of the polyhalite fertilizer site in 2020 was a cause for celebration in this remote part of Yorkshire after the previous owner ran out of cash. The miner offered high paying jobs, poured millions into local causes and ran a slick PR campaign.

In return, the company earned the enthusiastic backing of the community, which includes the picture-postcard North Sea fishing town of Whitby and a number of small villages scattered across the moors.

For local people who were excited about the windfall the mega-project would bring, the pullback has been gut-wrenching.

Indeed, 2,000 jobs go a long way in this part of the world. Whitby relies on tourism, whose jobs are seasonal and tend to pay less. About 30 miles (48 kilometers) away lie Middlesbrough and Redcar, towns once associated with the steel industry and now poster children for deprivation.

The northeast region had the lowest employment rate in the UK in the three months ending March 2024, at 69%, according to the Office for National Statistics.

One local business owner who declined to be identified said the area is “gutted” by the news. He has many friends who work at the mine, which lifted the area because its salaries gave people greater disposable income.

“That mine was very important for our area,” said Jane Thomas, who runs a bed-and-breakfast in Robin Hood Bay, close to the mine site. “Most of the work here is seasonal, it’s hospitality, tourism.”

For hikers on the Yorkshire moors, there’s nothing to suggest they’re walking over a vast mining project. From the distance, the only hint as to what lies below is a tall hut in a clearing, a sort of oversized barn jutting through the heather-clad moorland.

Whether the Woodsmith mine will be completed is still unclear. Once operational, the polyhalite, a relatively obscure form of fertilizer, would then be sent through the country’s longest tunnel to Teesside on the North Sea coast.

The material would then be processed in a facility in the Teesside Freeport, a free-trade zone and key project of the UK’s governing Conservative Party, which has made “levelling up” poorer regions a flagship policy.

Robert Goodwill, the local Conservative member of parliament, said he received assurances that Anglo will keep the project ticking along so it can resume at some point. The aim is to keep it viable, he said, though the future remains worrying.

“It’s very disappointing,” Goodwill said. “There’s a lot of local jobs, young people starting apprenticeships. We were told these would be secure jobs for 100 years.”

(By Jack Ryan)