Despite the continuing news about the bubble bursting on the Australian mining industry, there was a strong indication things may not be as dire as the media would have us all believe. Yes. it’s true, there have been projects put on hold and cost cutting measures have been put in place by some of the big mining companies like Fortescue Metals Group and BHP Billiton. However, in a recent interview ANDREW Michelmore (former chief executive of MMG) offered a new ‘insiders spin’† on the workings of the Chinese economy and its impact on the global prices of iron ore and coal.
He was quoted as saying “Whilst the rate of growth may have slowed, China is indeed still growing, it’s not going backwards”. He agrees with the consensus that the market got ‘over-heated’, but it is going to come back.
His comments are not just fanciful ideas and personal opinions about the mining industry in Australia. MMG is a $US4 billion company with impressive growth plans for the future. It is 72 percent owned by China Minmetals Corp. For more than 45 years, it was the only Chinese group that was allowed to go out into the Western world so secure mineral commodities.
This compounds Michelmore’s statements owing to the fact he has ‘insider information’ from one of the top companies in China shedding light on exactly what the China economy is up to and its potential impact on minerals commodity demand. He also noted the change in Chinese government was also a contributing factor to the hesitation of China to keep imports at record heights.
The new government is expected to be finalised by November, which could pave the way for less stressful times ahead for the Australian mining industry and offer the right conditions for further mining jobs to be created as new projects come online.