Expertspeak: Raw material demand to propel global equipment

The rapidly accelerating global procurement demand for raw materials also presents mining equipment manufacturers with ever-greater challenges. New technologies as well as ideas help meet the challenges of the future.Klaus Stöckmann and Rajesh Nath give us a German supplier’s projection of future demand, customisation and safety.

Germany is among the most important suppliers for the Indian mining market besides the US and China. The Indo-German trade in mining equip­ment has a brilliant history: In 2003, equipment worth only €1.36 million was sold to India. In 2010 German manufacturers could dramatically raise the export of min­ing machinery up to €57 million. Mostly, long­wall shearers and heading or tunnelling machines were sold.

This year, nearly 18 million tonne of copper will be consumed globally, which is set to almost double by 2050. It is
primarily the rapid degree of industrialisation in threshold and deve­loping countries in Asia and South America that is
triggering the demand for raw materials. China alone increased its coal production of just under one billion tonne in 2000 to some 3.1 billion tonne last year, and in South America, a significant rise in the dem­and for raw materials is also being forecast. In India, coal consumption is expected to triple to two billion tonne over the next 20 years.

Much of the machinery and equipment that are required to meet this demand will be supplied by the inter­national mining equipment industry. Therefore, the fut­ure prospects of the sector are more than just good. Since 2007, manufacturers have been able to increase their turnover from €3.41 billion to last year’s figure of €3.81 billion. Success that is unquestionably due to the open­ing of new sales regions and the consistent fostering of existing trade links. However, this alone is not enough to convince the market.The key here is to offer the right products and services.Only when both fit the bill along with a fair price a company will be able to hold its own on the market long term.

But what will products and services of the future look like? What demands will be made of man and machine in five, 10-20 years, and how will com­petition on world markets evolve? The success of both the German and inter­n­ational mining equipment indu­stry will hinge on the answers to these questions. The German Engi­neering Association (Verband Deutscher Maschinen-und Anlag­enbau, or VDMA) grouping together most of the mining equipment manufacturers located in Germany, recently launched a series of events entitled “Future Mining: What will the next generation mine look like?” The deliberations helped manufacturers recognise the challenges of the future and to find ways to address them.

Tailor-Made Solutions
The German mining equipment industry is well pre­pared for the challenges of the future and this is demon­strated primarily by its current success. Ultimately, this is because it simply provides the right answers to ques­tions posed in the past. This year, manufacturers antici­pate further growth in turnover. In 2010, they were able to more than compensate for their orders shortfall in 2009 by achieving a two percent positive, up to €3.81 billion.

The impulses for this growth came primarily from threshold and developing countries as well as from India and China, the largest export market for mining equip­ment made in Germany. Turnover there last year rose by a substantial 38 percent from €233 million to €322 million. Thus, demand for raw materials continues to rise unabated. An end to the boom is not in sight. Nearly 80 percent of the energy generated in China and more than 65 percent in India comes from coal-fired power stations. In future this proportion, and therefore the demand for coal, will continue to see high growth.

Mining at Ever-Greater Depths
Some people are predicting the start of a long-lasting ‘superboom’ for the global coal industry led by China and India. The reason for this forecast is the vast energy dem­ands that are to be met by the building of new coal-fired power stations. In the next five years alone, new power stations with total output of 390 GW will be com­missioned worldwide, and annual demand for coal will rise by app­roximately one billion tonne. The trend is not focused on mining coal mining alone but also on other raw materials as well as mining at greater-than-ever-before depths. And with their vast experience prim­arily gathered on the dom­estic market in under­ground mining, German manu­fac­turers will benefit here. Only last year, German com­pany Eickhoff Bergbautechnik GmbH brought the first fully automatic shearer loaders for underground coal min­ing onto the market, thereby making the long envisioned automatic long-wall mining a reality.

Growing Demand for Safety Engineering
German manufacturers see great potential in the developing and threshold countries of Asia and South Amer­ica. Even ahead of Australia, Indonesia, for example, has now burgeoned as the world’s largest coal exporting nation in the world. The reason for this lies in the fact that the distances and therefore transportation costs to major export destinations like China and India are lower than those from Australia. In key demand is safety engineering, and German manufacturers lead the field here.