The emphasis is on the procurement aspect of obtaining mining exploration services, ensuring that the necessary resources and expertise are secured to carry out successful mining exploration activities. The global mining market is anticipated to grow at a CAGR of 6.5% from 2024 to 2030. The five key stages of mining include exploration, discovery, development, production, and reclamation. Under this global industry, mining exploration services are also anticipated to follow the industry CAGR of 6.5% during the forecast period. Mining exploration, sometimes known as mineral exploration, is a multidimensional process that attempts to limit the search space to identify new mineral reserves. A few examples include - industrial raw materials (such as sulphur, salts, limestone, fertilizer minerals, etc.), ore extraction from metals (such as copper, zinc, iron ores, etc.), gemstones (such as opals and diamonds), and solid fuels (such as uranium, coal, and oil shale). Several surveys, whether geophysical, geological, or geochemical, are required to pick potentially attractive exploration prospects. There are numerous industries throughout the world that rely on underground mineral commodities for their supply. Future supply volumes could be significantly increased by emerging technologies, such as enhanced metal recovery (from waste streams or low-grade ores) or direct lithium extraction.
There is a growing demand for clean energy infrastructure which is, in turn, driving the growth of this market. Wind farms, solar photovoltaic (PV) facilities, and EVs all demand more minerals to create than their fossil fuel-powered competitors. For instance, EVs require six times more minerals than traditional ICE vehicles. Similarly, an onshore wind plant needs nine times more minerals than traditional gas-powered plants. In 2023, according to the World Bank, to meet the rising demand for EVs and wind power, the production of energy-critical minerals is expected to increase by almost 500% by 2050. The expanding demand for minerals and metals necessitates more mining exploration activities. This massive shift to clean energy means that the energy sector is emerging as a major driver in the minerals and mining market. As per IEA 2023 estimates, it is one of the fastest-growing sectors generating such high demand. Over the next two decades, it is estimated that copper demand is going to increase to 40%, nickel and cobalt demand will rise to 60 - 70%, and lithium will increase to 90%. Such factors are likely to aid the further expansion of this industry.
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One of the major challenges in this market is the quality reduction in mineral resources. In recent years, the quality has been on a declining trend across a range of minerals or commodities. For example, the grade of copper, on average, has declined by more than 30% over the last 15 years. This, in turn, not only exerts upward pressure on production costs but also makes it more energy-intensive for mining companies to extract minerals from reduced ore grades thereby generating higher waste volumes and carbon emissions. Companies face growing pressure from consumers and investors to source minerals in a sustainable and responsible manner.
The global mining exploration services are fragmented. Mining is a global industry; however, the largest companies are based out of these five countries - China, Australia, Switzerland, Brazil, and the U.K. On a global level, due to regional fragmentation, the bargaining power of the suppliers is low. However, this industry consists of a few large-scale players (for instance, Glencore, Jiangxi Copper, BHP, Rio Tinto, etc.) who hold dominant positions in the market and thereby command a higher power than the regional small players. Many Chinese companies are aggressively increasing their investments in overseas markets - such as Australia, DRC, Indonesia, and Chile. Two of the major barriers to entry include reduced companies spend on mining exploration and a lack of significant initial capital investment for new entrants. There are no major substitutes for drilling operations but for modelling and survey activities, the latest technology such as autonomous systems, AI, robots, and drones can pose a medium threat.
Mining exploration activities are expensive, and, in many cases, it can be challenging to fund mineral resources. Mineral exploration needs large investments, persistent financial inflow, and extensive time with inherently high risk. From drill core collection to analysis, costs can range from USD 100,000 and much more. The primary cost components are drilling and preliminary exploration, facilities/ plant and equipment, labor, and freight and transportation. Preliminary exploration costs can include elements such as staking, surveying and trenching. Other costs can include materials and supplies, insurance, travel, haulage, testing or inspection, lateral developments (if any), overheads, etc. Factors such as location, regulatory landscape, ESG guidelines, access and infrastructure further influence the total cost of the services. For instance, in 2023, the global budget for nonferrous mineral exploration stood at USD 12.6 billion. Compared to 2022, this was a reduction of 3% in 2023. In 2022, there was a 16% increase in, on average, for non-ferrous mineral explorations. This was mainly attributed to increasing interest in the energy sector coupled with decarbonization efforts by companies following the COVID-19 pandemic. Exploration budgets for green metals such as nickel, copper, and lithium increased by greater percentages in 2022. The majority of the increases in 2022, however, went to gold on a dollar basis, rising by 12%. Some of the cost models used in this industry are parametric, engineering, analog, and hybrid models. Each model uses a different set of inputs and assumptions.
Under sourcing and procurement intelligence, China is one of the leading countries in terms of mining exploration (for many commodities) followed by Indonesia and India. China is also particularly in demand for rare-earth elements, and gold and iron ore exploration. In 2022, China accounted for almost 70% of the global production. Indonesia and India are the most sought-after countries for coal mining activities. The most exploited commodities or minerals in this market are coal, potash, iron ore, and copper. Clients, as part of their procurement strategies for mining exploration services, select category vendors on multiple specified parameters. Some of them include careful evaluation of the mining site, kinds of equipment used with technology, analyze capabilities, vendor industry specialization, etc. Other considerations include choosing suppliers that provide increased transparency and end-to-end visibility throughout the process.
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Mining Exploration Services Procurement Intelligence Report Scope
• Mining Exploration Services Growth Rate (Global): CAGR of 6.5% from 2024 to 2030**
• Pricing Growth Outlook: 10% - 20% (Annually)
• Pricing Models: Parametric, engineering, analog, and hybrid cost model
• Supplier Selection Scope: Cost and pricing, Past engagements, Productivity, Geographical presence
• Supplier Selection Criteria: By service type (Prospecting, Geochemistry and Geometallurgy, Drilling and Assaying, 3D and Orebody Modeling), years in service, technology or equipment used, and other functional capabilities.
• Report Coverage: Revenue forecast, supplier ranking, supplier matrix, emerging technology, pricing models, cost structure, competitive landscape, growth factors, trends, engagement, and operating model
Key Companies
• Glencore PLC
• Jiangxi Copper Co. Ltd
• BHP Group Ltd
• Rio Tinto PLC
• Vale SA
• Zijin Mining Group Co. Ltd
• Anglo American PLC
• Hindalco Industries Ltd
• Fortescue Metals Group Limited
• Southern Copper Corporation
• Freeport-McMoRan Inc.
• Coal India Limited
Brief about Pipeline by Grand View Research:
A smart and effective supply chain is essential for growth in any organization. Pipeline division at Grand View Research provides detailed insights on every aspect of supply chain, which helps in efficient procurement decisions.
Our services include (not limited to):
• Market Intelligence involving – market size and forecast, growth factors, and driving trends
• Price and Cost Intelligence – pricing models adopted for the category, total cost of ownerships
• Supplier Intelligence – rich insight on supplier landscape, and identifies suppliers who are dominating, emerging, lounging, and specializing
• Sourcing / Procurement Intelligence – best practices followed in the industry, identifying standard KPIs and SLAs, peer analysis, negotiation strategies to be utilized with the suppliers, and best suited countries for sourcing to minimize supply chain disruptions
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