The surplus of raw materials, particularly metal, together with a corresponding massive fall in prices have also left a mark on German mining machinery manufacturers’ balance sheets. The industry expects a 3% drop in sales to €3.62 billion for the current year, according to the Mining Association in the German Engineering Federation (VDMA), though it added that manufacturers have a positive outlook on the future.

The downward trend has continued on the domestic market for mining machinery manufacturers in Germany. Political discussions about the future of lignite fuelled power stations “is putting pressure on investment levels”, said Dr Michael Schulte Strathaus, Chairman of the Mining Association in the German Engineering Federation (VDMA), at the annual press conference in Essen/Germany. He announced a decline in sales of some 8% to €210 million for the industry in the current year. A continuing decline in profits is expected for 2016.

Manufacturers expect a 3% fall in international sales to €3.41 billion this year. The Mediterranean and Middle East account for the largest export markets (17%). Saudi Arabia has become the largest customer with an 8% share. Together with Iran, governments there want to reduce their dependency on oil, according to Schulte Strathaus. Mining is being developed as an additional mainstay. Latin America is the second biggest sales region with an 11% market share, followed by China with 8%, the USA with 7% and Russia with approximately 5%.

The industry expects a further low single-figure percentage decline in exports for the coming year. The president blames this on weak investment levels due to ongoing poor results from raw material producers. They are currently fighting falling prices by shutting down production plants. Some analysts expect the copper surplus to turn into a shortage as early as 2017, said Schulte Strathaus. Given the difficult situation, all in all mining machinery manufacturers have “done really well”. Significant adjustments to staffing levels have been avoided, with the number of employees falling by only about 600 to 13,700 over the past twelve months. Short-time work is only a limited answer to multiple changes in market conditions, said Schulte Strathaus.

Mining machinery manufacturers hold a positive outlook on the future. As the president announced, an increasing number of companies are registering a rise in customer enquiries. Some sectors are also developing new areas of business, for example in hard-rock mining. They assume that demand for the raw materials extracted in hard-rock mining will increase substantially as a result of a global expansion in alternative methods of energy production. Manufacturers see the need for raw material producers to reduce costs as a further cause for optimism, since this can only be achieved by increasing efficiency. “And that”, said Schulte Strathaus, “is where our machinery and plant come into play”. A global trend toward increasing safety also benefits German manufacturers. He also believes that the next construction industry trade fair, BAUMA, to be held in Munich in April 2016, may well “provide a certain boost”.

Schulte Strathaus particularly welcomed the establishing to date of four competence centres for mining and raw materials by the Federal Ministry of Economics. Their brief was to promote the government’s renewable resources policies on site in Canada, Chile, South Africa and Australia. Two further centres are planned in Brazil and Peru. Manufacturers are co-operating closely with these institutions. Schulte Strathaus: “This also helps us to win new clients and orders.”

In order to maintain their leading position, particularly in the underground mining sector, manufacturers have been involved with Industry 4.0, “for much longer than the term even exists”, as Schulte Strathaus remarked. The industry presented the first machinery to mine coal or other material entirely independently and autonomously in early 2010, and in global comparison is “certainly at the forefront” of modernising its own production facilities.