BMI View: Russia's mineral production growth will remain solid over the coming years. C oal and gold production will outperform PGM's and iron ore output growth. However, the sector's growth will be hindered by weak global mineral prices and Western sanctions. Furthermore, the country's restrictive regulatory environment will deter foreign investment from entering the sector.
We believe Russia's mining sector will experience solid, but not rapid growth over the coming years. Russia has significant growth potential due to its rich mineral deposits, including coal, iron ore, gold and platinum. Additionally, a number of new projects are set to come online, such as Polyus Gold's Natalka mine, which is one of the largest gold mines in the world. However, the country's bureaucratic hurdles, effects of western sanctions and weak mineral prices will limit new projects from coming online and weaken mining output growth over the coming quarters.
| Solid Growth Outlook |
|Russia - Select Mining Production (% chg y-o-y)|
Coal To Outperform
We believe Russia's coal sector will grow strongly over the long term. The state plans to spend an estimated USD123bn developing the country's coal reserves over 2012-2030, alongside major investment into logistics and engineering capacities. We expect a gradual re-orientation of Russia's coal exports from Europe to Asia will be driven by growing demand for both thermal and coking coal in the region. Russian coal miners will benefit from rising coal demand from Asia and several major infrastructure projects are underway to facilitate greater coal trade flows.
Regulatory Hurdles To Remain Key Concern
The Russian government will maintain strong influence on the country's mining industry. For instance, the government holds significant stockpiles of palladium and restricts the amount of palladium that can be exported each year. This way, the Russian government can exert significant influence over the global palladium price through sales...
The Russia Mining Report has been researched at source and features Business Monitor International (BMI)'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 Russia 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 Russia.
- Use BMI's independent industry forecasts on Russia to test other views - a key input for successful budgeting and planning in this mining market.
- Target business opportunities and risks in Russia's mining sector through our reviews of latest mining industry trends, regulatory changes and major deals, projects and investments in Russia.
- 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.