Central America & Caribbean Mining Report

Published 23 February 2015

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Central America & Caribbean Mining Report

BMI View: Mining sectors across Central America and the Caribbean will see varying growth prospects in 2019. T he region has significant untapped mineral potential, yet a range of business environments and operational challenges will lead to uneven growth . Overall, the mining sectors of Colombia and Panama will see the strongest longer-term growth, while Guatemala, and to a lesser extent Honduras, will underperform.

Colombia and Panama will outperform other countries in Central America and the Caribbean in terms of mining sector growth over the coming years. The two will lead in their overall business environments and mining sector regulatory frameworks, enabling consistent investment and sector development despite subdued industrial and precious metal prices. Furthermore, both have significant untapped base and precious metal reserves. Colombia will remain one of the world's top exporters of thermal coal in the coming years, and will seek to further diversify its exports and target Asian consumers. Panama will become a major copper exporter once its Cobre Panama copper and gold mine, owned and operated by First Quantum, comes online in Q417, thus delaying significant sector growth until the latter half of the decade.

Colombia & Panama To Outperform
Select Countries - Mining Industry Value Growth (% chg y-o-y)

The Dominican Republic and Jamaica will see middling performance over our forecast period. The former has seen its mining sector expand significantly in recent quarters owing to the ramp up of the Pueblo Viejo mine, operated by Barrick Gold and Goldcorp. While the Dominican Republic has other mining projects in development, we expect the overall pace of mining sector expansion will be modest in the years ahead. Meanwhile, Jamaica will also see only modest mining sector growth. We expect relatively new investment in the country's bauxite sector, though subdued oil prices will lower input costs for miners, potentially boosting production...

BMI Industry View
7
Frontier Central American Markets To Underperform
9
SWOT
10
Industry Forecast
11
Coal: Growth Ahead, Yet Risks Linger
11
Foreign Demand To Support Sector Growth
12
Risks To Outlook
14
Table: Colombia - Coal Production (2011-2019)
14
Gold: Future Still Looks Golden
14
Smaller Players To Continue Exploration & Development
15
Local Opposition To Pose Downside Risk
16
Table: The Dominican Republic - Gold Production (2011-2019)
17
Gold And Silver: Muted Outlook
17
Table: Guatemala - Mining Projects
17
Protests And Resource Nationalism To Hinder Sector
18
Table: Guatemala Mining Forecasts (2011-2019)
18
Gold And Silver: Some Growth, But Headwinds To Limit Development
19
Headwinds To Persist
20
Table: Honduras Gold & Silver Forecasts (2011-2019)
20
Bauxite: Slowly Regaining Ground
20
Western Markets To Remain Top Buyers
21
Table: Jamaica Bauxite Forecasts (2011-2019)
22
Gold: Golden Future Still Years Away
22
Table: Panama- Mining Projects
23
Headwinds To Limit Short-Term Prospects
24
Table: Panama Gold Forecasts (2011-2019)
25
Table: Table: Panama - Gold Production
25
Gold: Shift To Gold To Continue
25
Gold To Present Opportunities
25
Risks Ahead
26
Table: Suriname - Gold And Bauxite Production
27
Industry Risk Reward Ratings
28
Colombia Risk/Reward Index
28
Rewards
28
Industry Rewards
28
Country Rewards
28
Risks
29
Industry Risks
29
Country Risks
29
Table: Mining Industry Forecasts (Colombia 2011-2019)
30
Jamaica Risk/Reward Index
30
Rewards
30
Industry Rewards
30
Country Rewards
30
Risks
31
Industry Risks
31
Country Risks
31
Table: Mining Industry Forecasts (Jamaica 2011-2019)
32
Panama Risk/Reward Ratings
32
Rewards
32
Industry Rewards
32
Country Rewards
32
Risks
33
Industry Risks
33
Country Risks
33
Table: Mining Industry Forecasts (Panama 2011-2019)
33
The Dominican Republic Risk/Reward Index
33
Rewards
34
Industry Rewards
34
Country Rewards
34
Risks
35
Industry Risks
35
Country Risks
35
Table: Mining Industry Forecasts (Dominican Republic 2011-2019)
35
Industry Risk Reward Index
35
Regional Risks Increase Modestly
35
Weak Prices To Hurt, While Stronger Dollar A Mixed Blessing
36
Regional Outlook Unchanged Despite Some Reordering
37
Table: Americas - Mining Risk/Reward Index
38
Regulatory Development
39
Panama And Colombia To Be Most Favourable Destinations
39
Dominican Republic To See Potential Tension
39
Guatemala & Honduras To Lag
40
Jamaica And Suriname To Maintain Status Quo
40
Table: Regional Regulatory Index
40
Commodities Forecast
42
Commodity Strategy
42
Ferrous Metals
42
Non-Ferrous Metals
46
Aluminium: Abating Tightness To Cap Prices
46
Copper: Continued Weakness Ahead
47
Lead: Prices To Firm As Year Progresses
48
Nickel: Prices Will Only Rise Gradually
49
Tin: Waiting On A Deficit
50
Zinc: Modest Price Growth On Tighter Supply But Looser Demand
51
Table: Select Commodities - Performance & BMI Forecasts
53
Competitive Landscape
54
Smaller Players Pursuing Opportunities
54
Table: Financial Metrics
55
Company Profile
56
Goldcorp
56
Latest Results
58
Table: Goldcorp - Key Financial Data
58
Barrick Gold
60
Company Strategy
61
Latest Results
63
Financial Data
63
Table: Barrick - Key Financial Data
63
Address Details
64
First Quantum
65
Latest Results
68
Table: First Quantum: Key Financial Data
68
Regional Overview
70
Three Key Themes For Americas Mining
70
Regulatory Changes On Horizon
70
Dollar Strength To Be Mixed Blessing
72
Region To Grow More Dominant As Top Copper Source
73
Global Industry Overview
74
Global Overview
74
2
77
3
78
5
82
Methodology
84
Industry Forecast Methodology
84
Sources
85
Risk/Reward Index Methodology
86
Table: Weighting Of Indicators
87

The Central America & Caribbean Mining Report has been researched at source and features BMI Research's mining and commodity forecasts for metals, minerals and gems, covering all major indicators including reserves, production, exports and values. The report also analyses trends and prospects, national and multinational companies and changes in the regulatory environment.

BMI's Central America & Caribbean Mining Report provides industry strategists, service companies, company analysts and consultants, government departments, trade associations and regulatory bodies with BMI's independent forecasts and competitive intelligence on the mining industry in Colombia, Panama, Venezuela, Jamaica, Dominican Republic.

Key Benefits

  • Use BMI's independent industry forecasts on Colombia, Panama, Venezuela, Jamaica, Dominican Republic to test other views - a key input for successful budgeting and planning in this mining market.
  • Target business opportunities and risks in Colombia, Panama, Venezuela, Jamaica, Dominican Republic's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Colombia, Panama, Venezuela, Jamaica, Dominican Republic.
  • Assess the activities, strategy and market position of your competitors, partners and clients via our Company Profiles (inc. KPIs and latest activity), Key Projects Tables and Competitive Landscape Tables.

Coverage

BMI Industry View

Summary of BMI’s key forecasts and industry analysis, covering mining reserves, supply, demand and prices, plus analysis of landmark company developments and key changes in the regulatory environment.

Industry SWOT analysis

Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the mining sector and within the broader political, economic and business environment.

BMI Industry Forecasts

Historic data series (2009-2013) and forecasts to end-2019 for key industry and economic indicators, supported by explicit assumptions, plus analysis of key risks to the main forecasts. Indicators include:

  • Mining industry: Industry size (USDmn), real growth (%), % of GDP, employment (‘000), workforce as % of total workforce, average wage (USD).
  • Output: Production volumes (‘000 tonnes, carats etc.) for all major metals, minerals, ores and gems mined in each state, including bauxite, copper, gold, coal, lead, silver, tin, titanium, uranium, zinc etc.
  • Exports: Value of exports (USDmn) for all major metals, minerals, ores and gems mined in each state.
  • Commodity markets: Global demand, supply, stocks and benchmark prices (USD) for aluminium, copper, lead, nickel, tin, zinc, gold and steel.

BMI’s Mining Risk Reward Index

BMI’s Risk Reward Indices provide investors (mining companies and support service providers) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors, with each position explained.

Competitive Landscape Tables & Analysis

Comparative company analyses and tables detailing USD sales, % share of total sales, number of employees, year established, market cap/NAV, ownership structure, production and % market share.

Key Projects

Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.

Company Profiles*

Examines the competitive positioning and short- to medium-term business strategies of key industry players. Strategy is examined within the context of BMI’s industry forecasts, our macroeconomic views and our understanding of the wider competitive landscape. The latest financial and operating statistics and key company developments are also incorporated within the company profiles, enabling a full evaluation of recent company performance and future growth prospects.

Sources

The Mining reports are based on an extensive network of primary sources, such as multilateral organisations (UN, WB, IMF), national chambers of commerce and industry, national statistical offices, government ministries and central banks, and multinational companies.

*Company profiles are not available for every country. Those reports instead contain information on the current activities of prominent companies operating in the market.

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