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800-plus exhibitors to showcase their products, services at Electra Mining 2016

9th September 2016

By: Ilan Solomons

Creamer Media Staff Writer

  

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JOHANNESBURG (miningweekly.com) – It has become increasingly important for mining equipment and service providers to attend trade shows to benefit from increased marketing opportunities amid the difficult operating conditions in the global mining industry, says Electra Mining Africa 2016 show organiser Specialised Exhibitions Montgomery MD Gary Corin.

More than 850 local and international exhibitors from the mining, industrial, electrical and power industries will showcase their products and services across the net 38 000 m2 indoor and outdoor exhibition area of Electra Mining Africa 2016. The biennial event will run from September 12 to 16 at the Expo Centre, in Johannesburg.

Corin comments that, during times of challenging market conditions, it becomes all the more important to meet suppliers face to face to secure the most beneficial business transactions possible. “Electra Mining Africa 2016 will provide these opportunities for local and international mining and related industries . . . It is a valuable platform for engagement, collaboration, interaction and networking.”

He states that the event puts South Africa’s renowned mining goods and services in the spotlight, with the trade show having consistently attracted international visitors seeking out local products, machinery, services and technology. Corin highlights that this has led to valuable export business for exhibitors.

“The show is also a recognised gateway into Africa for local and global businesses looking to expand their footprint on the continent in the mining, industrial, electricity and power sectors by exporting their goods and services to other African countries.”

For the past 44 years, Electra Mining Africa has provided support for these industries, regardless of the economic environment, with a “proven record” for driving sales, sales leads and building brand awareness, Corin emphasises.

Further, he highlights that the trade show delivers a good return on investment for exhibitors. By close of business on the last day of Electra Mining Africa 2014, about 30% of exhibitors had booked space for this year’s show.

“On average, we retain about 70% of our exhibitors, some of whom have been exhibiting at every show since 1972,” Corin enthuses.

He contends that much of Electra Mining Africa’s success is due to each show being treated as a new event. “We embrace change and the show has constantly evolved over the years to meet the needs of exhibitors and visitors.”

Audited figures of Electra Mining Africa 2014 by the Union des Fiores Internationales (Global Association of the Exhibition Industry) have confirmed that it was the best attended trade show in Southern Africa.

“Ranked as one of the world’s largest mining shows and the biggest mining, industrial, electrical and power trade show in Southern Africa, its . . . credibility has ensured its having consistently attracted more than 34 000 visitors at each of the past five shows,” Corin enthuses.

MINING GOODS AND SERVICES SIGNIFICANCE
The global mining equipment sector is forecast to grow at a compound annual growth rate of 7.9% between 2016 and 2022 to exceed $150-billion by 2022.

This is according to ‘World Mining Equipment Market – Opportunities and Forecasts, 2015 to 2022’, a report published in July by global market research company Allied Market Research.

The report highlights that the major factors boosting demand for mining equipment include the rising demand for metal and mineral commodities, and the increasing consumption of natural resources such as coal, diamonds and uranium.

Meanwhile, the South African Capital Equipment Export Council (Saceec) says domestic manufacturers of capital equipment stand a better chance of being sustainable in the country’s struggling economy by opening up export channels and liaising with foreign customers to build stronger ties in international markets.

Saceec has divided the South African capital equipment industry into five strategic segments – agriculture, mining, building and construction, processing industries (such as agroprocessing, chemicals and motor manufacturing) and utilities (such as State-owned entities Eskom and Transnet).

The largest segment is mining, representing as much as 80% of the capital equipment industry, owing to the “vast amount” of capital equipment required and the historical size of this segment in the country.

Independent minerals policy analyst Dr Paul Jourdan estimates that the market for mining equipment trade into the South African Development Community (SADC) region is about $8-billion a year. He also estimates that the region comprises about 70% of Africa’s market for mining equipment sales, which highlights the importance of the region to mining equipment suppliers. “West Africa makes up about 11%, with the rest of the continent contributing only 15% of the mining equipment sales market.”

SOUTH AFRICA'S STANDING
South Africa’s mining equipment and services sector is globally competitive, University of Johannesburg-affiliated research and capacity development group the Centre for Competition Regulation and Economic Development senior associate Dr Judith Fessehaie tells Mining Weekly.

It is one of South Africa’s most “dynamic sectors” in terms of export performance, innovation and backward linkages, she confirms.

“In recent times, however, the sector has been facing serious challenges, owing to stagnant domestic demand and the impact of commodity prices on potential export demand,” Fessehaie states, adding, however, that the depreciation of the rand has helped the country’s export competitiveness.

But, she notes, South African mining equipment and service providers are struggling to enter the export market: “Exporting is risky and costly, and some local firms lack market information, contacts or resources to reduce their risks.”

Thus, for local companies to compete with globally established original-equipment manufacturers, they need to have a well- resourced strategy for the SADC region, Fessehaie advises.

Additionally, she says, local firms need to find better ways of cooperating among themselves and with public institutions to address challenges such as skills deficiencies and a lack of research and development (R&D) funding.

Jourdan emphasises that, to be competitive in the mining capital goods market, countries need “strong” R&D initiatives, which have been wanting in South Africa over the past 20 years, largely owing to the closure of the old Chamber of Mines Research Organisation (Comro) in 1993. He notes that the organisation was once one of the largest mining technology research institutions worldwide.

Comro is being revitalised as a public– private partnership under the management of the Council for Scientific and Industrial Research. It is hoped that the new Comro will help mining become the centrepiece of the cluster that advances Southern Africa’s economies through twenty-first-century know-how.

Further, Jourdan points out that the capital equipment sector’s R&D has also been weakened, owing to the relisting and exiting of major South African mining houses over the past 15 years. “These mining companies closed their capital equipment development subsidiaries because they did not regard technology as a core operational concern. Instead, they redirected their resources to focus solely on mining operations.

This essentially resulted in the deindustrialisation of the South African mining capital-goods sector, he contends. Consequently, South Africa has, over the past ten years, steadily lost its once-dominant mining capital-goods export market share in the SADC region to international players, particularly Nordic equipment providers.

Jourdan stresses that capital goods cannot survive without the “nursery” of R&D, explaining that Nordic countries (such as Sweden, which has one of the highest levels of R&D worldwide) are investing about 4% of their gross domestic product in R&D initiatives. “This is why these countries remain very competitive in the sector, while South Africa is becoming increasingly uncompetitive.”

Jourdan states that the profit margins of capital equipment producers are insufficient to finance high-quality R&D. Most major R&D initiatives globally are, therefore, sponsored by mining companies, which have implemented technological innovations to overcome challenges and improve operational efficiencies.

The mining segment of Operation Phakisa, says Jourdan, aims to address these R&D challenges in the local mining sector. Operation Phakisa was announced by President Jacob Zuma in his State of the Nation address in 2014 and is designed to fast-track the implementation of solutions to the country’s critical development issues.

He tells Mining Weekly that substantial investment by technology producers, mining houses and government is required to ensure that R&D on high-quality mining equipment is conducted locally. Nonetheless, Jourdan says Mining Phakisa’s efforts to rebuild South Africa’s mining equipment R&D capabilities will still take a number of years to achieve.

Jourdan is also currently the interim project manager for the Mining Equipment Manufacturing of South Africa (Memsa) cluster, which, once officially established, will focus on the development of underground mining technologies. Jourdan says Memsa members will seek to collaborate in the development of innovative local mining equipment, but particularly ultra-low- profile machines for South Africa’s hard-rock narrow-reef mines.

He also points out that the South African Minerals Processing Cluster, better known as Sampec, which was officially launched in September 2014, aims to facilitate and influence the development of government policies regarding the mining and mineral- processing sector.

“The timing is very good for the activation of these initiatives, as the utmost innovation and cooperation are required to ensure survival during a commodity downturn and global economic slowdown.

“It seems that . . . industry and government have recognised the need to unite to ensure the best possible outcomes for the country’s mining equipment and services sector,” Jourdan concludes.

Edited by Creamer Media Reporter

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