Locus of control over global mine production– developments between 1985 and 2018 against a historical background

Ericsson, M., Löf, O. & Löf, A. Locus of control over global mine production– developments between 1985 and 2018 against a historical background. Miner Econ (2024).

It is a well-known fact that mine production has shifted from the industrialised countries of Europe, North America and Japan to emerging economies in Latin America, Africa and Asia and to Australia since the mid-20th century. The lack of self-sufficiency or high import dependence, in particular of the so-called critical metals, has become an issue of great political concern in these industrialised countries over the past 15 years. This study of six metals, cobalt, copper, iron ore, lithium, manganese and rare earths, contrasts this picture of geographical location of production with an analysis of where the control over mine production around the world is based, which we call the locus of control. Production might have moved out of the industrialised countries but control over production by companies based in the industrialised countries remains and has even increased between 1985 and 2018. We measure control as share of the total value of the production of the six metals. European transnational mining companies have increased their control from 14 to 18% while mining companies based in North America have lost control, a decline from 13 to 8%. When Australian companies, that have more than tripled their control in the same period, are added, control by the industrialised countries has increased to 44% of these six metals. Companies based in Latin America, Africa and Asia excluding China, taken together have maintained their control level, roughly a third of the total value of the six metals. Inside this group of countries African share has dwindled from 12 to 3% while Asian companies have more than doubled their share from 5 to 12%. Control by mining companies based in the republics of the former Soviet Union have been reduced from 25 to 7% while in the same period Chinese companies’ control has doubled from 6 to 12% of the total value of these six metals. Countries in Asia (excluding China) together with Latin American and African countries produce 51% of these six metals measured by the value at the mine stage. However, companies based in these countries control not more than 33% of the production.

Kritiska råvaror ur ett svensk perspektiv – självförsörjning eller internationell strategi

Olof Löf, Anton Löf och Magnus Ericsson (2023) Kritiska råvaror ur ett svensk perspektiv – självförsörjning eller internationell strategi, Bergsmannen 6/23.

”En stabil och tillförlitlig råvaruförsörjning är av största vikt för den svenska industrins konkurrenskraft och samtidigt en nyckelfaktor för att åstadkomma en effektiv grön omställning av samhället i stort.” Utrikesdepartementet – En kreditgaranti för att säkra tillgången av råvaror.

Tillgång till råmaterial är en förutsättning och grundpelare för all industriell verksamhet. Den svenska tillverkningsindustrin måste ha säker tillgång på relevanta råvaror i ett kontinuerligt flöde till ett konkurrenskraftigt pris för att kunna fortsätta sin verksamhet på lång sikt.

Tanken på kritiska mineral och en oro för hur svensk industri ska klara sin råvaruförsörjning är inget nytt utan har funnits under hela 1900-talet. Det som skiljer sig åt är exakt vilka råvaror som betraktas som kritiska. Intressant är dock att många av de råvaror som nu definieras som kritiska också upplevts som kritiska historiskt. Den upplevda bristen av råvaror är dock; ”inte ett objektivt, geologiskt faktum, utan bör analyseras som en upplevelse, en rädsla för en kommande brist” som Hanna Vikström formulerat det i sin avhandling The specter of scarcity: experiencing and coping with metal shortages, 1870-2015. Hittills verkar svensk industri dock stå stadigt och ha överlevt en rad kriser, trots över hundra år av en upplevd brist på råvaror.

Mass-Balance-Consistent Geological Stock Accounting: A New Approach toward Sustainable Management of Mineral Resources

Mark U. Simoni, Johannes A. Drielsma, Magnus Ericsson, Andrew G. Gunn, Sigurd Heiberg, Tom A. Heldal, Nedal T. Nassar, Evi Petavratzi, and Daniel B. Müller Environmental Science & Technology 2024 58 (2), 971-990

Global resource extraction raises concerns about environmental pressures and the security of mineral supply. Strategies to address these concerns depend on robust information on natural resource endowments, and on suitable methods to monitor and model their changes over time. However, current mineral resources and reserves reporting and accounting workflows are poorly suited for addressing mineral depletion or answering questions about the longterm sustainable supply. Our integrative review finds that the lack of a robust theoretical concept and framework for mass-balance (MB)- consistent geological stock accounting hinders systematic industry government data integration, resource governance, and strategy development. We evaluate the existing literature on geological stock accounting, identify shortcomings of current monitoring of mine production, and outline a conceptual framework for MB-consistent system integration based on material flow analysis (MFA). Our synthesis shows that recent developments in Earth observation, geoinformation management, and sustainability reporting act as catalysts that make MB-consistent geological stock accounting increasingly feasible. We propose first steps for its implementation and anticipate that our perspective as “resource realists” will facilitate the integration of geological and anthropogenic material systems, help secure future mineral supply, and support the global sustainability transition.

The perils of ranking mining countries and regions: a critical look at the annual survey of the Fraser Institute

Söderholm, P., Ericsson, M. & Hellman, F. The perils of ranking mining countries and regions: a critical look at the annual survey of the Fraser Institute. Miner Econ (2023).

The attractiveness of mineral investments across countries and regions worldwide can be judged through various measures, each with its strengths and weaknesses. The purpose of this paper is to scrutinize the Fraser Institute’s ranking of mining jurisdictions, which builds on eliciting the perceptions of industry representatives around the world through an annual survey. The analysis takes stock in the growing scholarship on country performance indicators and concludes that due to the low response rate and the lack of clear definitions of some of the underlying concepts (e.g., political stability), there are reasons to question both the reliability and the validity of this survey. There could also exist incentives among exploration companies to “game” the rankings. For these reasons, the ranking outcomes do not constitute a meaningful scorecard that countries can employ to improve their mining-related policies. However, despite these deficiencies, the Fraser Institute’s survey often enjoys relatively uncritical media attention. It even sets in motion a political “rankings game” in which the mining companies, governments, and other organized groups choose to participate. There is an urgent need for a more reliable and unbiased survey approach, including the consideration of alternative—complementing—measures for assessing investment attractiveness in the mining industry.

Cobalt: corporate concentration 1975–2018

Ericsson, M., Löf, A., Löf, O., Müller, D. Cobalt: corporate concentration 1975–2018. Miner Econ (2023).

The world’s dependency on cobalt mines in Congo and cobalt refineries in China is seen as serious security issues with potentially dangerous implications for the energy transition. However, Chinese refineries have a similar supply security issue as most of its cobalt concentrates are imported. Most supply security studies take a country perspective on market concentration and supply risks. However, control of the mines and refineries lies with the producing companies, not the governments of the countries where they are located. This paper analyses the corporate structure of the cobalt industry at the mine and the refinery stages over a longer time period to establish changes in the level of corporate concentration and to put the situation in 2018 in perspective. The level of corporate concentration at the mine stage is low and does not raise concerns for market failures or a lack of competitiveness. Corporate concentration of refined cobalt depends on the Chinese government’s influence over Chinese production: if the state control over individual refineries is assumed to be strong, the corporate concentration is high. Mine stage supply security could be strengthened by improving the general political stability in the DRC to make the country more attractive for investors other than the present ones. Increased local beneficiation would strongly benefit Congo and reduce China’s influence. This is a long and complicated process and its success is not at all certain. At the refinery stage, the solution is much easier: reliability of supply could be improved by constructing refineries in countries outside China.

The evolving structure of the global mining industry

Magnus Ericsson (2023) The evolving structure of the global mining industry, Matériaux & Techniques 111 (3) 303 2023

The green energy transition has been called a transition from a fossil fuel dependency to a metal and mineral dependency. Concerns about the security of future supplies are raised mainly in the EU and the USA with the Critical Raw Materials Act and the Inflation Reduction Act. The perspectives of these policies are centred on the demands created in the industrialised countries. The need for metals to lift billions of poor people out of poverty and to cater for the population growth is often, if not always, left out of the equation. While demand undoubtedly is increasing, the opposition to new mines and new renewable energy supply is strong and perhaps even increasing. It is necessary to find new ways to create a recognition that mining plays a key role for the green transition.

The mining permitting process in selected developed economies

Land Use Policy

Eva Liedholm Johnson, Magnus Ericsson, Anton Löf (2023) The mining permitting process in selected developed economies, Land Use Policy, Volume 131, 2023, 106762, ISSN 0264-8377,

This article surveys the mining permitting process and discusses the process to obtain permits for the exploration and mining of metals in five industrialised countries: Sweden, Finland, Poland, Western Australia (Australia) and Ontario (Canada). The purpose is to provide an overview of the permitting process when the demand for metals may grow at a faster pace than ever before. The countries have been chosen for their well-developed mining industries while still representing different historical and legal backgrounds and traditions. Focus lies on three aspects of the permitting process: Mining policy, legislation and permits; Environmental legislation and permits and; Stakeholder influence/participation including appeals. We describe the present situation in all countries in detail. The mining policy and legislation in the countries studied are converging and the mining laws are becoming increasingly similar. Legislation is being revised at shorter intervals, and minor additions and amendments can be made in between completely new legislation. In all the five countries emphasis is placed on ensuring that the permitting process is transparent and open from the first exploration steps to the closure of a depleted mine. Governments are developing new policies, legislation, regulations and permitting processes to ensure that the growing demand can be met while at the same time the increasing demands by various stakeholders on land use, environmental and social developments can increasingly be included in the permitting process.

Marine mining and its potential implications for low- and middle-income countries

WIDER Working Paper 2022/170

Löf, Anton, Magnus Ericsson, and Olof Löf (2022) Marine mining and its potential implications for low- and middle-income countries. Helsinki, UNU-WIDER.

After 50 years of optimistic predictions that marine mining will soon take off, it still remains to be seen if and when this will happen. In 2018 the total value of all marine mining, including both offshore mining and the so far non-existing deep-seabed mining, was estimated to be around US$35 billion, less than 1 per cent of land-based mining.

This paper focuses on the potential economic effects for LICs and MICs of expanding the extraction of marine deposits. The importance for these countries of creating a tailor-made tax regime to capture the optimum benefits from future marine mining is highlighted. Environmental problems are also discussed.

The current status of marine mining is outlined and the likelihood of progress in the near- and mid-term future is assessed. It seems likely that offshore mining will be of more immediate interest to LICs and MICs than deep-seabed mining, which is much more challenging.

Marine mining is a sub-part of the larger blue economy. The economic, social, and environmental effects of marine mining should always be seen alongside other vital parts of the blue economy, notably fishing and tourism, which generate considerable economic value.

The paper outlines the history of deep-seabed mining and its close connections in the 1960s and 1970s with the Cold War and the fight for independence by former colonies.

The paper summarizes the long road leading up to the United Nations Convention on the Law of the Sea, a unique international agreement to share the resources of the least exploited part of planet Earth for the benefit of humankind.

Seabed mining

Löf, A., M. Ericsson & O. Löf (2022) Seabed mining. Nordic Steel & Mining Review Nr 7 2022 p 6-12.

There are over fifty years of unsuccessful attempts to establish profitable deep sea mining (DSM). What we can see today is that seabed mining is done in water close to land in relatively shallow water in what is called offshore mining. Around 2010 when the metal prices were high, plans to exploit the seabed re-surfaced. Ten years on, most of these plans had been buried – again – as prices have fallen back. Today’s situation with the environment problems, the war in Ukraine and the rapid adjustment to more use of electricity, maybe will give deep sea mining a new chance.

This article is based on a forthcoming study for WIDER (World Institute for Development Economics Research).

Iron Ore Miners Increase Production Capacity

Steelmakers and iron ore miners will see future demand shift based on inflation, lingering COVID-19 and emissions reduction

Löf, A. & Löf, O. (2022) Iron ore outlook 2022 - Iron ore miners increase production capacity, E&MJ vol 223 #12 p 32-39

Global output of iron ore increased by 6.8% in 2021 and reached 2,477 Mt. Australia is the most important producing country, mining 37% of all iron ore globally (down from 40% in 2020). Brazil, the second most important country, accounts for 16% of global production (down from 17%) and China, the third largest producer, for 11% (up from 10%). Together the three leading countries thus account for 64% of total production (down from 66%). There are two more countries producing more than 100 Mt, India and Russia, together the five most important iron ore producing countries account for 79% of all iron ore produced in 2021 (down from 80% in 2020).

The global mining industry: corporate profile, complexity, and change

Hodge, R.A., Ericsson, M., Löf, O., Löf, A., Semkowich, P. The global mining industry: corporate profile, complexity, and change. Miner Econ (2022). https://doi.org/10.1007/s13563-022-00343-1

The continuation and increasing importance of mining is inevitable as society embraces both the transition to a low-carbon economy and application of circular economy concepts. However, across many parts of society, there is an ongoing sense that those who are carrying many of the costs and risks related to mining particularly over the long term (often host communities and countries) are not seeing a level of benefit that seems fair. In contrast, there is frustration within the industry that mining is not being given due credit for the importance of its role in contemporary society by those who would criticize industry practices. Over the past several decades, dozens of initiatives aimed at strengthening mining’s social and environmental performance have been mounted from both within and outside the industry. These generally depend on a “leadership-trickle-down” change model. While progress has been achieved, the society-industry trust deficit continues. The global mining community comprises a corporate core and a complex range of other surrounding interests. We suggest that some key questions regarding the nature of this community and its appetite and capacity for change have not been explored thus impeding the effectiveness of change management. We offer (1) an estimate of the number of companies that lie at the core of the global mining community: some 25,000 operating in about 140 countries (using data from the mid-2010s); (2) a profile of these companies as an initial step towards understanding the “culture” of the global mining community; and (3) a listing of additional complexities and observations important to bringing global-wide improvement to mining’s social and environmental performance. We argue that building on work to date, a fresh approach is required. We are calling for a dialog to reflect on the ideas presented here, refine them as appropriate, and develop the needed strategies and action plans. Such a process must build from a comprehensive understanding of the global mining community and its culture. It must be collaborative in nature and involve not only the range of mining companies but also with surrounding interests and governments. If this is not done, the change that is needed to align actions of all mining actors with social values will not occur and the trust deficit will remain.

EU klarar rysk gruv- och metallkollaps

Ericsson, M,. Löf, O. & Löf, A. (2022) EU klarar rysk gruv- och metallkollaps. Bergsmannen #4 2022 s.30-36.

Efter Rysslands invasion av Ukraina var EU, USA och många andra länder snabba med att införa sanktioner mot Ryssland. Det råder sedan den 15e mars importförbud till EU från Ryssland för stålprodukter och lyxvaror. ”Strikt nödvändiga” transaktioner av fossila bränslen, titan, aluminium, koppar, nickel, palladium och järnmalm är tillåtna, det finns alltså inget importförbud för de flesta metaller. Den 22a juli förbjöd EU dock import av guld från Ryssland, som efter olja och gas är deras viktigaste exportvara. Den 10e augusti infördes ett förbud mot import av kol.

Rysslands och Ukrainas metall- och mineralproduktion och dess betydelse för EU och världen

EUs importberoende av metaller som järnmalm, koppar och bauxit/aluminium och även så kallade kritiska råvaror (Critical Raw Materials, CRM) är välkänt. I skuggan av Rysslands invasion av Ukraina kommer frågan om hur EUs situation påverkas med anledning dels av en förändrad handelssituation med Ryssland och dels av förstörelse av gruvor och smältverk i Ukraina.

Rapporten sammanfattar:

• Rysslands roll som gruvproducent historiskt

• Rysk, ukrainsk och belarusisk produktion av metaller och mineral

• Rysk export av samma metaller och mineral

• EUs importberoende av Ryssland och Ukraina

• Viktigaste ryska och ukrainska gruvbolag

• Rysslands betydelse för försörjningen av metaller och mineral i några industribranscher

• Konsekvenser av handelsstopp med Ryssland och förstörelse i Ukraina

Digital economy growth and mineral resources - implications for developing countries

Ericsson, M., A. Löf & O. Löf (2021) Digital economy growth and mineral resources - implications for developing countries. Nordic Steel & Mining Review Nr 7 2021 p 6-12.

An ever-increasing number of elements form the basis of the digital economy. How will the continuing digitalisation affect mineral and metal demands and what implications will this have for mineral-rich developing countries?

A growing number of elements, metals and non-metals, form the basis of the digital economy. Seven information and communications technology (ICT) elements – gallium, germanium, indium, rare earth elements (REEs), selenium, tantalum and tellurium – are essential raw materials for the building blocks for most ICT hardware, such as microchips and integrated circuits. This article is based on a study by RMG Consulting, for the United Nations Conference on Trade and Development (UNCTAD) Geneva, on the likely impact of the continuing digitalisation on mineral and metal demands and what implications this might have for mineral-rich developing countries.

Iron ore outlook 2021 - Seaborne iron ore market softens

a healthy project pipeline will, however, help offset depleting resources and balance the market

Löf, A. & Löf, O. (2021) Iron ore outlook 2021 - Seaborne iron ore market softens, E&MJ vol 222 #12 p 48-53

Despite the COVID-19 pandemic, world crude steel production in 2020 grew to 1.878 billion metric tons (mt), according to the World Steel Association (WSA), a new global all-time high. This is the fifth consecutive year of growth.

Global output of iron ore decreased by 1.9% to 2.343 billion mt in 2020 (see Figure 1 and Table 2). Australia is the most important producing country, mining 39% of all iron ore globally. Brazil, the second most important country, accounts for 17%, and China, the third largest producer, for 12%. Together, the three leading countries account for 67% of total production.

Рост цифровой экономики в контексте минерально-сырьевых ресурсов: вовлеченность развивающихся стран

Ericsson, Magnus, Löf, Anton & Löf, Olof (2021) Tsvetnye metally" journal No. 7-2021

The digital economy and the need for raw materials. A global analysis.

Den digitala ekonomin och råvarubehoven

Ericsson, Magnus & Löf, Olof (2020) Bergsmannen #2 2021

Hur kan mineralrika utvecklingsländer dra nytta av den fortsatta digitaliseringen i världen. Det har Magnus Ericsson, Luleå tekniska universitet, och Olof Löf, RMG Consulting, studerat på uppdrag av FN-organet UNCTAD.

Ett ständigt växande antal grundämnen, metaller och icke-metaller, utgör basen för den digitala ekonomin. I en modern mobiltelefon finns det ett trettiotal olika grundämnen. RMG Consulting har gjort en studie på uppdrag av United Nations Conference on Trade and Development (UNCTAD) för att ta reda på hur den digitala ekonomins utveckling skapar efterfrågan på dessa grundämnen och om i så fall hur mineralrika utvecklingsländer kan dra nytta av den fortsatta digitaliseringen.

Swedish Mining Innovation baseline assessment and sustainability database – Final report 

Swedish Geological AB (SGAB) and RMG Consulting (2020) Swedish Mining Innovation baseline assessment and sustainability database – Final report. Swedish Mining Innovation.

ISBN: 978-91-519-9187-0 

This is a report for a project that uses publicly available data to assess the environmental and overall sustainability performance of the Swedish mining and metals producing sector during the period 2013-2018. The work has been done as part of a strategic project within the framework of Swedish Mining Innovation (Strategic innovation programme for the Swedish mining and metal producing industry) which is funded by Vinnova, the Swedish Energy Agency and the Swedish Research Council FORMAS.

The aims of the project were twofold, namely: (i) to develop and populate a database on sustainability aspects of the Swedish mining and minerals’ cluster, using publicly available data; and (ii) to use this database to evaluate whether the goals of Swedish Mining Innovation, as presented in the Swedish Mining Innovation project document are being reached (c.f. Swedish Mining Innovation, 2016, and Figure 1.1). 

Iron ore market report 2019–2020

Ericsson M., Löf A., Löf O. Iron ore market report 2019–2020. Gornaya promyshlennost = Russian Mining Industry. 2021;(1):74–82. (In Russ.) DOI: 10.30686/1609-9192-2021-1-74-82.Источник: https://mining-media.ru/en/articles/original-paper/16396-iron-ore-market-report-2019-2020

Preliminary figures of global iron ore and steel production in 2020 show a slight decline. The article reviews iron ore production by global companies (Vale, Rio Tinto, BHP, FMG, Anglo American, etc.) in 2019 and 2020, as well as production figures by the leading steel producing countries (China, India, Japan, Russia, USA, South Korea) in 2020. Iron ore imports and exports are also analyzed. It is noted that the global iron ore exports had increased by around 43% over the previous decade, however, they went down by 1.7% in 2019, and this decline in exports continued in 2020. Australia is the largest iron ore exporter with a market share of 55%; this share increased by one percentage point in 2020 compared to the previous year. Green-field projects by global producing companies are presented in Brazil, Australia and other countries. A conclusion is made that despite a 3.5% decline in the global economy forecast by the International Monetary Fund in 2020, it is possible to acknowledge that the iron ore market is well balanced. However, if steel demand and steel production volumes increase unexpectedly and some of the planned new mines are not commissioned, the surplus can quite promptly turn into a deficit. In the long term, the plans to produce steel without using fossil fuels, without coke and therefore without CO2 emissions, could revolutionize the iron ore market and increase the demand for products with a high iron content.Источник: https://mining-media.ru/en/articles/original-paper/16396-iron-ore-market-report-2019-2020

Resource rents in the diamond industry 2014–19: Rents, issues, methods, and data availability

WIDER Working Paper 2021/39 

Löf, Anton, Olof Löf, and Magnus Ericsson (2021) Resource rents in the diamond industry 2014–19: Rents, issues, methods, and data availability. Helsinki, UNU-WIDER.

The focus of this study is rent in the diamond industry. Based on extensive datasets and a discussion of all relevant costs, we present resource rent statistics from the diamond industry in key producer countries in emerging economies such as Angola, Botswana, Democratic Republic of the Congo, Lesotho, Namibia, Sierra Leone, and South Africa, as well as the Russian Federation. Resource rents give an indication of the available space for taxation. To use this potential tax space effectively in the long term without changing the investment behaviour of the mining companies and the long-term viability of the industry, all costs, such as environmental and financial costs, must be included. The study attempts to expand on earlier work by the World Bank to calculate mineral rents for mining industries other than the diamond industry. Rent calculated as precisely as possible is an important basis for wealth calculations and for mineral policy development.

The fossil-free future for mineral-rich, emerging countries

Ericsson, M., O. Löf & A. Löf (2020) The fossil-free future for mineral-rich, emerging countries. Nordic Steel & Mining Review Nr 7 2020 p 14-17.

The transition to a fossil-free future is, in part, a transition from hydrocarbons to metals. In a low-carbon future, demand for specific minerals and metals like copper, cobalt, lithium, nickel, graphite and several speciality metals will increase, sometimes dramatically. This means that those countries with the potential for mining these minerals/metals will have a unique opportunity to benefit from the expected future growth in demand. Many of these countries are to be found among the mineral-rich, emerging countries.

In a study carried out in cooperation with the United Nations University World Institute for Development Economics (UNU-WIDER), RMG Consulting studied chromium, cobalt, copper, graphite, lithium, manganese, molybdenum, nickel, niobium, palladium, platina, tantalum and the rare earth elements – all minerals/ metals for a low-carbon future – and the mineral-rich, emerging countries which are set to benefit from a surge in demand for these specific minerals/metals.

Digital Economy Growth and Mineral Resources: Implications for Developing Countries

TECHNICAL NOTE NO16 UNEDITED TN/UNCTAD/ICT4D/16 DECEMBER 2020

Ericsson, M. Löf, O & Löf, A. (2020) Digital economy growth and mineral resources: Implications for developing countries, UNCTAD.

This technical note examines the link between growing digitalization of the world economy and the demand for various elements. It feeds into the overall research work of the UNCTAD Ecommerce and Digital Economy (ECDE) work programme.

The study focuses on the following issues in view of the growing use of digital technologies: What metals/minerals will be more demanded as a result?; What changes in demand can be expected compared with today's situation?; Which mineral-rich developing countries are likely to be most affected by the growth in demand of different metals and minerals?; Which are the main actors (including possibly new actors such as digital companies) involved in the extraction, smelting and refining of these minerals and metals?; and How recyclable will these "new" metals be and to what extent may they be adding to the problem of "e-waste"?

Based primarily on desk top research, complemented by a few interviews with representatives from industry and academia, the study deals primarily with the functional parts of computers and other devices, which are at the core of the digital economy. Demands for raw materials from the structural parts of the devices and the networks necessary as well as their energy supply and the consequences of the transition to a fossil free world are not covered.

Iron ore outlook 2020

This Year’s Iron Ore Report Looks Much Better Than Many Expected - High prices and a tight market could extend the rally well into 2022

Löf, A. & Löf, O. (2020) Iron ore outlook 2020 - this years iron ore report looks much better than many expected, E&MJ vol 221 #11 p 28-33

During 2019, the fundamentals of the steel market weakened considerably. The OECD (Steel Market Developments Q2 2020) cited weakening global economic activity, uncertain prospects for steel demand growth, the upturn in new capacity investments and excess capacity as some of the reasons.

Despite this, according to the World Steel Association (WSA), world crude steel production grew to 1.869 billion metric tons (mt) in 2019, a new global all-time high. This is an increase of 3% over 2018, and the fourth consecutive year of growth.

Extractive dependency in lower-income countries

Evolving trends during the transition to a low carbon future

The first objective of this paper is to update earlier assessments of mineral dependence in lower-income countries. In 2018, the mining of metals and coal continued to be an important contributor to the economies of several low- and middle-income countries. As in our previous calculations of the Mining Contribution Index, African countries in particular benefit from this fact. When oil and gas are also included in estimates of export dependence on extractive industries, a number of new countries appear among those with the greatest dependence—again mostly African countries.

The second objective of this paper is to analyse the opportunities for developing countries of the present global transition to a world less dependent on fossil fuels. This process, it can be argued, is partly a transition from hydrocarbons to metals. Hence, countries with reserves of metals and minerals necessary for the low-carbon future, and in particular those with an existing mining industry, will be best positioned to take advantage of this transition. In this category are several African countries, including Burkina Faso, Côte D’Ivoire, DRC, Tanzania, Zambia, and Zimbabwe. In Asia there are Kyrgyzstan, Papua New Guinea, and Philippines, while in South America Bolivia is the only country.

Ericsson, M. & Löf, O. (2020) Extractive dependency in lower-income countries: Evolving trends during the transition to a low carbon future. WIDER Working Paper 2020/120. Helsinki: UNU-WIDER.

Chinese control over African and global mining—past, present and future

M. Ericsson, O. Löf & A. Löf Mineral Economics 2020.

Chinese companies are far from taking control over African or global mining. In 2018, they control less than 7% of the value of total African mine production. Chinese investments in African mining of non-fuel minerals between 1995 and 2018 have contributed to production growth but it has also increased Chinese control over African mineral and metal production. There is evidence pointing to a continued Chinese expansion in African minerals and metals but at a slower pace than in the past decade. Through a detailed analysis of every mine, fully or partially controlled by Chinese interest in Africa and all other parts of the world the paper also measures total Chinese control over global mine production to be around 3% of the total value.

Fossilfria samhället kan bli lyft för mineralrika utvecklingsländer

Ericsson, Magnus & Löf, Olof (2020) Bergsmannen #2 2020

Med omställningen till fossilfri energiproduktion går världen mot ett ökat metallberoende. I en analys undersöker Magnus Ericsson, adjungerad professor i mineralekonomi vid Luleå tekniska universitet, och Olof Löf, analytiker på RMG Consulting, vilka utvecklingsländer som kan bli vinnare på denna övergång. Och vilka som kan bli förlorare.

Global Iron Ore Report - Iron Ore Prices Remain Relatively High

Robust steel demand paired with iron ore production problems pushes the market into deficit; new capacity is waiting in the wings

Engineering & Mining Journal 2019 November

Anton Löf, Magnus Ericsson & Olof Löf

The fundamentals of the steel market weakened considerably during the second half of 2018. The OECD, in its Steel Market Developments Q2 2019 points toward important headwinds that persist for the steel industry. These include a weakening global economic outlook, the increase in trade frictions, excess capacity and a pickup in capacity investments.

World crude steel production grew to 1,808 million metric tons (mt) in 2018, a new global all-time high. This is an increase of 4.5% over 2017, and the third consecutive year of growth.

Global output of iron ore increased by a modest 1.1% to 2,241 million mt in 2018.

Mining’s contribution to national economies between 1996 and 2016

Magnus Ericsson & Olof Löf

In several low- and middle-income countries rich in non-fuel mineral resources, mining makes significant contributions to national economic development as measured by the revised Mining Contribution Index (MCI-Wr). 10 countries among the 20 countries where mining contribute most (highest MCI-Wr score) have moved up one or two steps in the World Bank’s country classification between 1996 and 2016. In particular African countries have benefitted. This paper provides an up-date and expansion of an earlier study within the framework of the United Nations University (UNU) World Institute for Development Economics Research (WIDER) initiative Extractives for Development. Based on the detailed data available for the sector, such as production, export, prices, mineral rents, exploration expenditure and government revenues an analysis is carried out of the current situation for 2016, and trends in mining’s contribution to economic development for the years 1996-2016. The contribution of minerals and mining to GDP and exports reached a maximum at the peak of the mining boom in 2011. Naturally the figures for mining’s contribution had declined for most countries by 2016, but importantly the levels were still considerably higher than in 1996. The results of this survey contradict the widespread view that mineral resources create a dependency that might not be conducive to economic and social development.

Keywords: mining industry, economy, mining, export, rent for mineral resources, mineral exploration expenses

Acknowledgements: Ericsson M., Löf O. Mining’s contribution to national economies between 1996 and 2016. Gornaya promyshlennost = Russian Mining Industry. 2019;(6):84–93. (In Russ.) DOI: 10.30686/1609-9192-2019-6-84-93.

Commodity Trading - Understanding the tax-related challenges for home and host countries

Anton Löf & Magnus Ericsson (2019)

Minerals and metals are, and will remain, the material foundation for all societies. 

Mining, minerals and metals are particularly important to emerging economies, both as a source of income for government and as input to build infrastructure of all types to provide basic consumer goods such as vehicles, refrigerators and other appliances. In the near future, the necessity to shift to fossil fuel-free energy will increase the demand for minerals and metals considerably.

There is also a legal aspect of natural resources, including minerals and metals, that is increasingly highlighted and appreciated. Commodity markets are global, and the trade in minerals and metals is growing. A growing share of mining takes place in developing countries, while a major part of demand for minerals and metals originates in China and in the industrialized countries.

In order to understand the role of metal trading companies and the potential tax risks their activities create, it is necessary to present some basic facts about the mineral and metal markets, including which minerals and metals are most important, where they are produced and the key steps from mining to refining. 

Iron Ore Market Review 2018

A. Löf, M. Ericsson & O. Löf (2019) Iron ore market review 2018, CIS Iron and Steel Review 2019 Vol. 17.

Iron ore prices remained at relatively high levels during 2018. Premia paid for high quality ores increased and are substantial. Global iron ore production is estimated to grow by around 2% in 2018. Sharp cuts in production of un-beneficiated ore have taken place in China during 2018. Demand for iron ore in general and for high grade products in particular has however increased. Future developments in China, both in the steel and iron ore industries, will be crucial to the global iron ore markets in 2019. This review is written in March 2019 and incorporates as much as possible figures and trends for the full year 2018, in some cases this is however not yet possible.

Mining’s contribution to national economies between 1996 and 2016

M. Ericsson & O. Löf Mineral Economics 2019.

In several low- and middle-income countries rich in non-fuel mineral resources, mining makes significant contributions to national economic development as measured by the revised Mining Contribution Index (MCI-Wr). Ten countries among the 20 countries where mining contributes most (highest MCI-Wr score) have moved up one or two steps in the World Bank’s country classification between 1996 and 2016. In particular, African countries have benefitted. Socio-economic development indicators also show signs of progress for African mineral-rich countries. This paper provides an update and expansion of an earlier study within the framework of the United Nations University (UNU) World Institute for Development Economics Research (WIDER) initiative Extractives for Development. Based on the detailed data available for the sector, such as production, export, prices, mineral rents, exploration expenditure and government revenues, an analysis is carried out of the current situation for 2016, and trends in mining’s contribution to economic development for the years 1996–2016. The contribution of minerals and mining to GDP and exports reached a maximum at the peak of the mining boom in 2011. Naturally, the figures for mining’s contribution had declined for most countries by 2016, but importantly the levels were still considerably higher than in 1996. The results of this survey contradict the widespread view that mineral resources create a dependency that might not be conducive to economic and social development. In addition, this paper presents an attempt to use already available socio-economic indicators for African mineral-rich countries to measure socio-economic developments. One preliminary conclusion of this survey is that mining countries perform better than oil-producing countries and non-mineral countries in Africa as measured by these indices of human development and governance.

Iron Ore Outlook 2018 - Iron Ore Markets Improve in Most Regions

Taking sharp cuts in steel production during the first half of 2018, future developments in China will be crucial to the iron ore market.

Löf, Anton. Ericsson, Magnus & Löf, Olof (October 2018). Iron ore markets improve in most regions. Engineering and mining journal, 219(10), 48-55.

Mineral grades: an important indicator for environmental impact of mineral exploitation

Priester, M. Ericsson, M. Dolega, P. & Löf, O. Mineral Economics 2019.

We have collected and analysed grade information for nine metals: copper, gold, iron, lead, manganese, nickel, PGM, tin, and zinc. Based on this analysis, we have developed a proposal of “grade classes”, i.e., what could be considered low-grade, average-grade, and high-grade deposits for all these metals. We discuss the implications of possible developments into the future of the grades of ores, from which these metals are extracted. A focus on high-grade deposits will naturally reduce the environmental impact of mining. For six metals (copper, gold, iron, nickel, PGM, and zinc), we have further analysed the volumes available for the 10% cohort of projects and operating mines with the highest grades. Three metals (iron, PGM, and zinc) show considerable volumes, between 15 and 20% of total metal content in resources in this high-grade percentile. Copper and gold have between 5 and 10% while nickel has only 1.7% in the highest 10% grade percentile.

INTERNATIONALISATION OF MINING EDUCATION AND RESEARCH – A RECURRING PROCESS RUNNING THROUGH THE CENTURIES

M. Ericsson “Internationalisation of mining education and research - a recurring process running through the centuries” EURASIAN MINING. 2018. No. 2. pp. 44–48

International cooperation and mobility are buzzwords of today’s research and innovation clusters all over the world. These are however not new concepts. The understanding that research and innovation can only thrive in an international and open environment has been in place for at least 300 years in Sweden. All interested and knowledgeable scientists and business developers have been welcomed to push the front of knowledge and the industry forward. The international contacts of Swedish mining education, research and innovation prove that with an open mind and a persistent, long term effort results will come.

The roots of mining education and research in Sweden dates back to the 17th century. Initially the focus was on applied research rather than education, but the early efforts also slowly led to important purely scientific results. Swedish metallurgists/chemists have discovered more elements than scientists from any other nation. Over 150 years, from the early 18th century to the end of the 19th century, 20 elements - and among them many industrially important metals — were isolated and described.

The ancient Falu copper mine was the logical choice for location of one of the first technical schools in Sweden: “Falu Bergskola” (Falu Mining School), which was set up in 1822. Its first director was precisely one of the chemical scientists engaged in the discovery of new elements. This Mining school was later merged with other existing institutions offering some technical training into “Tekniska Institutet” (the Technical Insitute). This was in 1876 transformed into a technical high school along German models. The Association of Swedish Iron and Steel industry (Jernkontoret in Swedish) was a key supporter and funder of these developments. The new school was called Kungliga Tekniska Högskolan (KTH) in translation Royal Institute of Technology. KTH had 5 departments, including a school of mining science.

In 1972 the education of mining engineers was transferred to the newly established Luleå Technical College close to the Arctic Circle. The College was later expanded and in 1997 renamed Luleå University of Technology (LTU).

LTU has become one of the leading mining universities in Europe, to a large extent due to the fact that it is situated in the centre of one of Europe’s remaining mining regions. Around 2/3 of all university trained staff employed by Swedish mining has been trained at LTU. But LTU has also had its focus on the mining sector for a long time and in its internal program Mines of the Future it has relentlessly pushed the importance of mining and minerals and demonstrated its ambition to be a leading actor in this area. LTU has been appointed by Swedish government to lead the national education and research in mining. The recent decision by the EU to locate one EIT Raw Materials CLC (Co-location Centre) to Luleå means that the university has been given a similar role also on the EU level. LTU has actively built international links and supported cooperation with other universities within Europe and around the world. The bold and officially stated aim is to become one of the globally leading mining universities.

Mining’s Contribution to National Economies - The extraction and export of minerals spurs economic development

Olof Löf & Magnus Ericsson

In several low- and middle-income countries with important extractive sectors, mining makes significant contributions to national economic and social development. Mineral-rich countries also develop faster than countries with few known mineral resources. These facts are based on results from a study within the framework of the United Nations University (UNU) World Institute for Development Economics Research (WIDER) initiative, Extractives for Development. The results of this survey contradict the widespread view that mineral resources create a dependency that might not be conducive to economic and social development. The study has been updated and now includes socioeconomic factors. One conclusion is that mining countries perform better than oil countries and non-mineral countries in human development and governance.

Löf, O. Ericsson, M. (2018). “Mining’s contribution to national economies” Engineering & Mining Journal. Volume 219, Issue 8. August 2018. pp.48-56.

Supporting the EU Mineral Sector - Capitalising on EU strengths through an investment promotion strategy

Masuma Farooki, Chris Hinde & Anton Lof

STRADE research indicates that there are strategic reasons to support the EU mining sector, which are not directly related to securing access to physical supply from domestic sources. A strong EU mining sector can contribute to the perception of the EU as a region with strong social, environmental and regulatory standards, which continues to pursue mining activity and is not looking to ‘export pollution’. The EU mining-tech sector, which is recognised as a leader in the international sector, will also benefit by working closely with mining operations and centres of innovation and research, to produce more efficient technology for the global mining sector.

The analysis of EU mineral production levels suggests that very little progress has been made in increasing exploration expenditure in the region and for base-metals at least, production is not expected to increase. While current EU mining support mechanisms (SIP and Horizon 2020 funding) should continue, there needs to be a focused investor promotion strategy. This needs to address three important issues; improving the mining regulations in Member States; better organised access to geological data and finally addressing the issue of negative social perceptions around mining by EU citizens.

STRADE recommends that to increase exploration expenditure in the EU, which is key to developing a healthy mining project pipeline, the best practice principles for mining regulations need to be more widely applied in EU Member States.

Restricting exploration licences and transfers through government discretion may not be the correct regulatory tool for this purpose. Clear regulatory rules would better serve to achieve this goal. The EC, through its support for exchange of best practice under SIP Action Plan, should assist governments to choose the appropriate tools for achieving their mining policies.

The construction of a Mining Rights Management System at the European Commission would be recommended, to be undertaken from a commercial investor prospective, to improve the access to geological data and licences. Investors can reach out to Member States for more detailed information.

The report recognises that while it may be felt by some stakeholders that the improvement of the public perception of mining is the mining industry’s responsibility, given the importance of minerals and metals for the health of European economies, the EU needs to consider creating citizen awareness campaigns and provide more information to European Parliamentarians as part of its responsibilities.

To create more investor interest, a One Stop Shop, operating under the umbrella of the EU is recommended, to be the first port of call for international investors seeking information about projects, regulations, codes and support for mining projects in the EU Member States. For the mining-tech sector, support for the domestic EU mining sector is required. In addition, the current EU funding for research, development and innovation should continue. One further aspect of research that could be added here is the meeting of mining technology research and innovation and communities who are impacted by innovation and technology. The SIP and EIP documents indicate that there is a good understanding of the factors that will promote mining in the EU, these need to be matched with raising investor interest and participation.

Farooki, M. Hinde, C. & Löf, A. (2018). “Supporting the EU Mineral Sector – Capitalising on EU strengths through an investment promotion strategy” European Union report strategic dialogue on sustainable raw materials for Europe (STRADE) No. 05/ 2018

EXTRACTIVE INDUSTRIES - The Management of Resources as a Driver of Sustainable Development

Edited by Tony Addison & Alan Roe

New initiatives recognize that resource wealth can provide a means, when properly used, for poorer nations to decisively break with poverty by diversifying economies and funding development spending. Extractive Industries: The Management of Resources as a Driver of Sustainable Development explores the challenges and opportunities facing developing countries in using oil, gas, and mining to achieve inclusive change. While resource wealth can yield prosperity it can also, when mismanaged, cause acute social inequality, deep poverty, environmental damage, and political instability. There is a new determination to improve the benefits of extractive industries to their host countries, and to strengthen the sector’s governance. Extractive Industries provides a comprehensive contribution to what must be done in this sector to deliver development, protect often fragile environments from damage, enhance the rights of affected communities, and support climate change action. It brings together international experts to offer ideas and recommendations in the main policy areas. With a breadth of collective insight and experience, it argues that more attention must be given to the development role of extractive industries, and looks to the future to explain how action on climate change will profoundly shape the sector’s prospects.

Chapter 3. Mining's contribution to low- and middle-income economies 
Magnus Ericsson & Olof Löf (2018)

Chapter 25. Downstream activities: The possibilities and the realities 
Olle Östensson & Anton Löf (2018)

Raw materials management in iron and steelmaking firms

This paper adds new knowledge on how raw materials should be managed in iron and steelmaking firms. While previous research has contributed significantly to how firms should deal with functional challenges related to raw materials, the understanding of Raw Materials Management from a holistic perspective is largely lacking, and extant research does not provide qualified advice to firms on this matter. This study provides such knowledge by drawing on insights from Höganäs AB, a world leader in ferrous powder metallurgy, and their efforts to identify key aspects and principles of raw materials management. Our elaboration of a more holistic view on raw materials management builds on two elements. First, we depict five external uncertainties and three internal conditions that impact firm-level raw materials management. Second, we present six critical capabilities that underpin proficient firm-level raw materials management. The paper concludes with a discussion of implications for both firms aiming to increase their raw materials proficiency and to future investigations into this important area.

Florén, Henrik. Frishammar, Johan. Löf, Anton & Ericsson, Magnus. (2018). Mineral Economics.

Iron Ore Market Report 2017

Prices and demand for high-quality iron ore increases. Future over capacity could threaten lower quality and high cost iron ore operations.

Löf, Anton. & Ericsson, Magnus. (November 2017). Iron ore market report 2017. Engineering and mining journal (1926), 218(11), 32-37.

Mining’s contribution to low- and middle-income economies

In several low- and middle-income countries with important extractive sectors, gross national income has developed favourably. Africa has benefitted most, particularly West Africa. This survey provides an up-to-date statistical analysis of the contribution of non-fuel minerals mining to low- and middle-income economies.

Using the detailed data available for the minerals sector, an analysis is carried out of the current situation for 2014, and of trends in mining’s contribution to economic development for the years 1996–2014. The contribution of minerals and mining to gross domestic product and exports reached a maximum at the peak of the mining boom in 2011.

Although the figures for mining’s contribution had declined for most countries by 2014, the levels were still considerably higher than in 1996. The results of this survey contradict the widespread view that mineral resources create a dependency that might not be conducive to economic and social development.

Ericsson, Magnus. & Löf, Olof. (June 2017). Mining’s contribution to low- and middle-income economies.  WIDER Working Paper 148/2017 UNU-WIDER.

Iron Ore 2015: Market Review and Forecast

Weak growth and an oversupplied market will keep iron ore prices flat into the future

Löf, A. & M. Ericsson (2015) Iron Ore 2015: Market Review and Forecast. Engineering and mining journal.

Iron Ore Market Review 2014: Prospects Persist for Oversupply and Weak Prices

After a precipitous fall in 2014, iron ore prices should stabilize—and even rise modestly—in the near future, but shifting global economic trends and the shadow of significant oversupply may squash any hopes for quick market rejuvenation.

Ericsson, M. & A. Löf (2014) Iron Ore Market Review 2014: Prospects Persist for Oversupply and Weak Prices. Engineering and mining journal.

Global Resources - Conflict and Cooperation

edited by Roland Dannreuther and Wojciech Ostrowski (2013)

Oil, gas and minerals are vital natural resources which meet crucial human needs. Modern civilisation would struggle to survive without readily available access to these resources at reasonable and affordable prices. This volume provides critical insights into the dynamic processes of conflict and cooperation in relation to oil, gas and minerals, recognising that there is no easy and clear separation between areas of cooperation and of conflict and that these relations co-exist in complex and continually evolving ways. The contributors argue that the nature of conflict and cooperation is increasingly being shaped by the shift towards state capitalism in many parts of the resource-producing world.

Chapter 11, Mineral Depletion and Peak Production

Magnus Ericsson and Patrik Söderholm

Iron Ore Review: High Prices and Tight Markets to Continue Until 2013?

Ericsson, M., A. Löf & O. Östensson (2011) Iron Ore Review: High Prices and Tight Markets to Continue Until 2013? Engineering and Mining Journal.

Iron Ore Outlook: Facing a Slow Climb Out of the Pit

Our review of 2008–2009 market developments concludes that an oversupply situation will continue for the remainder of this year and into the next, when prices could begin to stabilize in preparation for a possible upturn in 2011.

Ericsson, M. & A. Löf (2009) Iron Ore Outlook: Facing a Slow Climb Out of the Pit. Engineering and Mining Journal.