BMI View: Ghana's mining sector will remain heavily reliant on gold production and, as such, will face severe headwinds over the next few years as prices of the commodity come under increasing pressure globally.
|e/f= BMI estimate/forecast. Source= National Sources, BMI|
|Mining Industry Value, USDbn||3.32||3.38||3.45||3.35||3.32||3.29|
|Mining Industry Value, USDbn, % y-o-y||1.30||1.90||2.00||-2.87||-1.07||-0.79|
Latest Developments & Structural Trends
Ghana's mining sector growth will be affected by a lack of diversity, as the country's gold sector accounts for about 90.0% of total mineral exports. An ongoing decline in global prices will therefore pose a major threat to the growth of Ghana's mining sector going forwards, with prices forecast to average USD1,120/USD over 2015-2019. Falling prices will put increased pressure on the profit margins of the country's gold miners, with many firms, including market leader Newmont Mining, moving to cut expenditure in the face of falling revenues. Despite gold price weakness, the country's mining sector will remain an important component of Ghana's economy through the next few years.
On June 17, 2015, Ghana's Chamber of Mines announced that the country's gold mining revenue declined by 17.4% y-o-y over 2014 to USD3.8bn. This supports our view that continued gold price weakness will force major players to cut costs and scale back operations. We forecast gold prices to average USD1,120/oz over 2015-2019, significantly lower than USD1,427/oz average over 2010-2014.
On April 21, 2015, miners at Newmont Mining's Akyem project resumed work after a four-day strike. The strike was the result of prolonged wage negotiations between Newmont and the Ghana Mineworkers Union (GMWU). The negotiations, regarding salary and collective service, took taken place between over an eight-month period. Both parties will call on the National Labour Commission to mediate and resolve the issue.
The Ghana 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 Ghana 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 Ghana.
- Use BMI's independent industry forecasts on Ghana to test other views - a key input for successful budgeting and planning in this mining market.
- Target business opportunities and risks in Ghana's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Ghana.
- 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.
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.
Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by metal/ore.
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.
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.