Ministry predicts mining slowdown amid global market slump
Ministry predicts mining slowdown amid global market slump
The Ministry of Energy and Mines' summary report released last week states that the mining sector expects growth to decrease this 2013-14 fiscal year, falling slightly by an estimated 10.56 percent compared with the previous year.
The ministry's summary said the slowdown would be a consequence of the price of ore on the global market failing to improve, especially the prices of gold, potash and copper.
“And recently there have not been any new mining projects,” the ministry said.
Gold, potash and copper aside, the ministry maintains hope that production of other minerals will still allow growth to meet the plan.
The other mined materials include 26.99 tonnes of unprocessed gold, 99,000 tonnes of copper, 171,000 tonnes of lignite and 423 tonnes of potassium.
The ministry reported that in the first six months of this fiscal year, the mining sector saw negative growth of 16.33 percent compared with the same period in the previous year.
In March, the ministry reported that the sector expected ore production to reach around 7,382 billion kip in the first six months of this fiscal year.
That figure would include around 13.3 tonnes of gold and silver ore, around 41 tonnes of copper, 135 tonnes of lignite and in the vicinity of 200 tonnes of potash.
In the first quarter of this fiscal year ore production was worth 3,919 billion kip, which represented a 2.4 percent increase compared with the same period last fiscal year.
“However the 2.4 percent increase was not so large,” the ministry said.
The growth was not particularly large because the Xepon mine in Savannakhet province was in the process of shutting down its gold production.
The ministry said the production of gold declined because the gold price dropped on the global market.
The gold price started falling in the third and fourth quarter of last fiscal year (2012-13), selling for only US$1,200-US$1,300 per ounce, which significantly impacted gold production.
The mining sector has both local operators and investors from overseas, including investors from Asean countries.
By last December, there were 64 companies operating 99 mining projects on a total area of 274,663 hectares in Laos, the ministry's report noted.
Mining operations have been divided into two main groups. One group is responsible for excavating the ore and processing it, and this group has 35 companies. The second group, which constructs factories, has 35 companies in it.
vientiane times
