Mining industry, Colombia’s ‘motor of the economy’, contracted in 2013

Posted on Feb 21 2014 - 1:52am by Editor
Miner

2013 was a bad year for Colombia’s mining industry with the three most important export products recording lower numbers than 2012.

Due to a culmination of factors, coal, goal and nickel all recorded lower output in 2013 than 2012. According to Large-Scale Mining Association representative Claudia Jimenez , the bad year for the industry was due to a “free fall in commodity prices in the international market,” according to newspaper La Vanguardia Liberal.

However a key issue within Colombia itself was that Drummond and Cerrejon, the two biggest mining companies in Colombia, suffered at the hands of striking workers as well as controversial trade embargoes such as Drummond being banned from shipping for three weeks by the national licensing authority due to dumping coal in the Caribbean Sea.

According to the National Mining Agency (ANM), coal production reached 89.2 million tons in 2012 and only 85.5 million tons in 2013 – a reduction of 4%.

With regards to gold, the drop was more pronounced, from 66.18 tons to 55.74 tons, signifying a decline in production of 16% when, between 2011 and 2012 it had had an increase of 18%.

Nickel went down from 51.98 million tons to 49.32 million tons marking a 5% loss of production.

However it was not only those three which were affected. Silver experienced a drop from 21.35 tons to 15.38 tons.

Platinum was the only one which saw a production increase of 5% from 1.469 kg to 1.504 kg from 2012 to 2013.

According to the Colombian Deputy Mining Minister Cesar Diaz, ”as with any industry, there are some external influences which were outside of our control and what we now need to do is turn the page and look for the recovery. With regards to this we are committed and we are working.”

Economist Amylkar Acosta Medina told newspaper El Espectador that this is “only a temporary situation” and the country should prepare for the return of the boom in the coming years. However he concedes that there have been “pointers that it may not be so easy to return to the high levels of production that have been seen in recent years.”

Mining is by far Colombia’s largest export industry and considered the main force behind the drop in export last year.

MORE: Santos’ FTA Promises Prove False; Colombia’s Exports To US Drop 15.5%

There is also the issue that $7.3 billion of expected foreign investments are currently being stalled due to delays in environmental approvals and the decreased demand from overseas.

Sources

The post Mining industry, Colombia’s ‘motor of the economy’, contracted in 2013 appeared first on Colombia News | Colombia Reports.