Camimex: the global mining industry contracted 3.3% in 2020

The global mining industry contracted at an annual rate of 3.3% in 2020, reported the Mexican Mining Chamber (Camimex).

Due to border closures and logistical limitations stemming from the Covid-19 pandemic, the global mining industry experienced that drop, according to the production volume index.

What were the causes? A supply cut, induced by the closure of activities, the depression of demand due to temporary border closures, reduced mobility and reduced consumption, among other factors.

Meanwhile, metal prices showed a growth trend in 2020, minimal in the case of base metals, with a growth of 1% compared to 2019, and significant in the case of precious metals, with a rate of 26.6 percent.

China is the main consumer of raw materials in the world, being the most relevant in most non-ferrous metals.

This nation is also the most important producer of many non-ferrous metals and there are some elements, such as rare earths, that are obtained almost exclusively in that country.

Camimex

The Covid-19 crisis captured all the attention in terms of economic analysis in 2020; However, China‘s consumption of raw materials showed signs of weakness even before the outbreak of the pandemic, among other causes, due to the economic maturation process it is going through and trade disputes with the United States since 2019.

So all this, according to Camimex, forced many companies to relocate their productive assets in an accelerated manner to other countries with good port infrastructure and competitive labor costs.

This trend was defined since April for precious metals and since May for base metals, since in the first months of 2020 there was a drop in the price indices of both groups of metals, a period that coincides with the crisis initial pandemic and the most significant closures in developed countries.