Posted November 09, 2018 14:34:17The Australian mining industry has suffered a deep economic downturn with the collapse of gold and other commodity prices, according to figures released today by the National Australia Bank.
Key points:The ANZ survey found that mining firms are suffering a deep downturn, with miners hit hardestThe downturn is being felt in the iron ore industryThe ANAIB found the downturn has affected mining firms like BHP, Rio Tinto and Rio TunesGold prices have fallen by almost 60 per cent since 2016, with BHP and Rio being the most affected of the big three mining companies, the ANAB said.
The ANB said the mining downturn has impacted mining firms including BHP with a loss of $14.6 billion and Rio with a $7.9 billion loss.
“Despite a sharp decline in mining activity in 2016, there is an indication that the downturn in the mining industry is being reflected in the Australian economy,” the ANB reported.
“The outlook for the Australian mining sector remains broadly stable, but it is likely to be slower in the coming quarters due to the impacts of the mining decline.”
We expect mining firms to suffer a deep recession this year as a result of the current downturn and the resulting impact on the economy.
“The ANI survey found the industry’s losses are driven by the decline in the price of gold.
Gold prices fell by almost $600 a troy ounce in the past year, while Rio Tines lost $1.2 billion, Rio Minerals lost $3.9 million and Rio Minerations was down $2.6 million.
The latest ANAIAB survey also found that Australian mining companies are the most vulnerable to the downturn.”
For mining companies in particular, the impact of the downturn on their profitability and growth outlook is expected to be substantial,” the report found.”
More than half of mining companies surveyed reported significant or moderate losses in operating profit in 2016.
“The report said the downturn was being felt more acutely by the iron and coal mining industry than the oil and gas and gas mining industries.
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