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A return to mining industry growth with a heavy focus on productivity, as well as the need to continually focus more on environmental and waste management, is underpinning growing demand for chemical inputs. BNamericas speaks to Nilson Bartalini, head of mining for Latin America at Swiss specialty chemicals maker Clariant for insights into the drivers of the chemicals market and where in the region he sees the most potential for growth.
BNamericas: The global mining industry is seeing a return to optimism. As a supplier to the mining industry, do you share that view?
Bartalini: The mining industry went through a period of excessive supply as a result of optimism regarding the high prices of mineral commodities a few years ago. Hefty investments were made in new projects and expansions, which, in mining, take a few years to mature.
When the new volumes were achieved, they were met by an environment of sparse global growth, in which demand for minerals grew considerably less than the increase in supply. Sadly, the crisis that affected our industry eventually led suppliers to restrict production or close less competitive mines, which consequently reduced production capacity and balanced out the market.
This brought prices back up to levels that generated positive financial results for many companies in the industry and has led them to start reducing idle capacity at existing plants, and once again, invest in greenfield and brownfield projects.
BNamericas: Do you see it reflected in increased demand for some of your products that are key for the industry, like explosives and froth flotation?
Bartalini: Demand for mining chemicals has been intensifying over the last few months, thanks to the increased production resulting from reduced idle capacity, new expansions and new plants. In addition to traditional products, like explosives and flotation agents, companies have been paying more attention to environmental issues and seeking solutions to improve waste management, increase particulate control throughout the mining process, and optimize water recirculation, just to name a few.
BNamericas: Where are your biggest markets in Latin America and what are your expectations in terms of growth over the next two or three years in the region?
Bartalini: Our primary markets are Brazil, Chile and Peru, and we work with iron, copper, gold, zinc, niobium, and other ores. We expect the market to grow as customers are optimizing usage of existing capacity, since the major projects have already concluded their ramp-up phases or are in their completion phases. And also because Clariant has been offering new solutions to improve the recovery of mineral resources, provide a more sustainable approach and improve logistics processes.
BNamericas: In what countries do you see more growth opportunities right now?
Bartalini: We have great opportunities for growth in Peru and Mexico. We're replicating the service strategy we currently use in Brazil and Chile where we have significant market participation, by offering intensive technical support, R&D, A&D and guaranteed supply through local production.
BNamericas: Since the end of the commodities boom, the mining industry has put a strong focus on productivity. What role does a company like Clariant play in terms of helping the industry achieve higher levels of efficiency and productivity?
Bartalini: Clariant understands the importance of reducing our customers' Total Cost of Operations (TCO) and helping to make their operations sustainable. Based on their needs, and in partnership with them, we strive to develop solutions to increase recovery of their mineral resources, improve the quality of their concentrates, and reduce the environmental impact of their activities.
With increasingly better recovery rates, we not only offer optimized results, but also reduced waste generation. Treating waste so that it can be disposed of differently than how it's done today reduces the risk of accidents, increases water recirculation and reduces fresh water requirements. By reducing concentrate moisture levels, we reduce carbon dioxide emissions during transport. By reducing suspended particulates, we improve occupational hygiene and the air quality around mines and plants. Clariant has been working on these aspects in many projects in partnership with the mining industry. Our company invests heavily in the research and development of solutions that address these market demands, with a focus on growing and enhancing our customers' operations.
About the company
Clariant is a globally leading specialty chemicals company, based in Muttenz near Basel/Switzerland. On 31 December 2016 the company employed a total workforce of 17 442. In the financial year 2016, Clariant recorded sales of CHF 5.847 billion for its continuing businesses. The company reports in four business areas: Care Chemicals, Catalysis, Natural Resources, and Plastics & Coatings. Clariant's corporate strategy is based on five pillars: focus on innovation through R&D, add value with sustainability, reposition portfolio, intensify growth, and increase profitability.