This week PricewaterhouseCoopers (PwC) released their seventh annual survey of the Top 40 mining companies. As it is done by PwC they are studied by market cap,  financial performance and position of the global mining industry is discussed. Despite all economic hurdles, the world’s largest mining companies recovered in 2009 as their net worth more than doubled despite lower profits and revenues. However tough the last year was, the biggest market players reacted quick funding was restructured, mines were closed and production cut as margins declined.

“While cash flow from operations decreased, the Top 40 still spent $74 billion on investing activities in 2009. The vast majority of the spend was on plant and equipment as funds were channelled to existing projects, which had greater potential for a short-term impact on reserve replacement and production.However, in contrast, the year ended with the market capitalisation of the Top 40 returning to the heights of 2007 and a cautious optimism returning to market releases,” – mentions the report. It goes on further: “Exploration spend by the Top 40 declined significantly, not surprising given its discretionary nature. As reserve replacement becomes more challenging, the lack of spend on exploration poses the question—when and where will the next world-class mines be found?”

Of course, it is impossible to miss the hottest subject these days: “The Australian government recently announced a “Resources Super Profits Tax” and royalty increases have been flagged in several other jurisdictions. Mining and politics are intertwined, but the industry has recently moved even further up the political agenda, with focus on matters such as taxation, carbon and sovereign influence.”

While there is an abundance of valuable information in the report and the final chart is this:

I would like to note one very important feature: it has an analysis of major metals and commodities that is really useful for mining strategists – when you are planning to develop your mining business.

There was a lot of talk about potash in the last year – so here we are – for the first time potash miners are included in the list. That means that potash is one of the new trends in business development?  “Potash companies have drawn notice during 2009 as a commodity of interest for the diversified miners, particularly as the significance of their mineral development and extraction business grows”, – notes the report. The comparison of commodity prices is also worth thinking about:

And its comparison with revenue:

So, this all and much more make the document really worth reading….

“Mine: Back to the Boom” report  can be downloaded HERE