“Productivity and rising costs continue to be on the radar for mining and metals companies, and their importance has been amplified in these times of volatility,” says Theo Yameogo, EY Canada Mining and Metals Co-Leader. “While all mines are affected by declining ore grades, increasing complexities across the value chain and pressure on commodity prices, there’s a silver lining. COVID-19 restrictions have triggered compelling reasons to rethink cost structures, remove silos and anchor performance around relevant productivity metrics.”
New to the list this year are geopolitics (5) and volatility (8). The shifting geopolitical landscape in large economies is changing sector dynamics and driving a trend towards economic protectionism, including tariffs and export bans. Moreover, fluctuations in both supply and demand are expected to drive increased volatility and larger swings in commodity prices.
“The mining industry will need to make sustainable, long-term decisions as they deal with the return of severe commodity price volatility, the threat of geopolitics and evolving stakeholder priorities,” says Yameogo. “Moving forward, many companies will look to do things differently — to remove complexity, overcome historical barriers and accelerate a transformation agenda that focuses on long-term resilience for the business, symbiotic relationships with communities and the renaissance of the entire sector.”
Access the EY mining and metals Top 10 business risks and opportunities — 2021 survey here.