Downturns can be beneficial, mining students told

Economic blasts are rumbling the ground on which the mining industry stands these days.

As nickel prices drop alongside copper and other local commodities, Robert Assabgui, Vale Canada's general manager of mining and milling, estimates that more than half of producers are losing money at current prices, and these companies are having to make major changes to their operations.

For students moving into the employment field in the next few years, the current bust in the cycle could be unnerving.

“You can tell we're in a bust because usually there's pyro and a live band when I come on,” joked Jeff Fuller to a crowd of gathered students on Thursday night.

Assabgui and the owner of Fuller Supply presented on the boom and bust cycles of mining alongside fellow industry leaders, at the sixth annual Mining Day at Laurentian. The event was attended by around 250 mining students from Laurentian, Cambrian College and Collège Boréal.

Students received a stark breakdown of the current situation, but panelists also focused on innovation in the downturn and said they see an end in sight.

Fuller said downturns can force companies to look outside the local market to grow their business, which can benefit them in the long run.

At Vale, Assibgui said they’ve learned to “consult with people who do the work.” Schedule changes made with input from the people who actually work in their mines have resulted in higher production, with zero impact on labour costs, a discovery they may not have made without the push to monitor spending more carefully.

Jon Treen from Stantec compared playing the boom and bust cycle to playing the market and recommended companies act more like a mutual fund, and diversify.

“Buy low and sell high for the market, but for industry, educate low,” said Treen.

He said getting an education during a bust is the best time, because by the time students graduate they are likely to be heading back up into a boom.

Technica Mining's Alistair Ross gave similar advice, recommending companies play a market game and hang onto cash for the downturn, and spend it then.

“If you get lucky with your expenditure, you will come out bigger and stronger during the next upturn,” he said.

“Don't be concerned about this,” Ross told the students, ending on a positive note. “The good times will be back, and there's opportunities in the downturn.”