Worldwide, mining exploration is worth $17 billion to the global economy. Twenty per cent of that money is being invested in Canada.
For every job in the mining industry itself, two jobs are created at companies that supply the exploration companies with equipment and services.
On Thursday several of those companies gathered in Thunder Bay to get an idea of how they might benefit, either by targeting mining specifically or diversifying what they’re currently doing to tap into the lucrative global and regional market.
Jon Baird, the president of the Canadian Association of Mining Equipment and Services for Export, told the gathering of executives that it makes smart sense for them to spend a little time devising a business and marketing plan – something few have done to date – as a starting to point to tackle the industry.
“They say if you don’t know where you’re going, any road will take you there,” said Baird, calling the mining supply industry a hidden sector in Canada.
First and foremost is to understand the industry is cyclical, but constant.
“The point is, there is not a year when the demand for more commodities decreases,” he said. “The prices may go up and down.”
The growing middle class in countries like China and India, where two-thirds of the world’s population lives, ensures it, he added.
“People want refrigerators and televisions. High rises are being built and then people need furniture. This is not going to stop.”
Terry Olsen, president of Coastal Steel Construction in Thunder Bay, said his company realized early on that it had to spread its wings or face the consequences.
A heavy supplier to the forest industry, when it failed they had to look elsewhere.
At first they sought contracts in Western Canada’s oil sands, but when the price of crude fell sharply, the work began to disappear.
Olsen said diversification is imperative for survival, and not just for his company.
“You have to go out and try to find business. You can’t wait for it to come to you. We’ve been fortunate we’ve been doing work all over Canada,” he said.
They’ve found mining customers as far away as the Northwest Territories and as nearby as the Musselwhite gold mine in Northwestern Ontario.
“That’s where the business is today. Pulp and paper, unfortunately, has gone the way it has and we’ve had to look for other work and we’ve been very successful at chasing that work,” Olsen said, also on the executive of the Thunder Bay Metal Fabricator’s Association, admitting he never dreamed how big a role mining would play in his business.
When the oil industry began to dry up, they immediately began chasing potash and uranium mines in Saskatchewan, with terrific results.
“That’s really paying dividends for a lot of companies within our group, I’m very happy to say.”
That’s music to Thunder Bay Chamber of Commerce president Harold Wilson’s ears. Wilson, who staged the two-day mining conference alongside the Thunder Bay Community Economic Development Corporation, said opportunities abound, but local companies haven’t necessarily tapped their full potential.
Not even close, Wilson said, especially when it comes to exports.
“Our folks are busy. They’re busy in a lot of ways. And they’re worried about where their markets are currently and the customers they have, their suppliers, their staffing and who’s going to plow their parking lot tomorrow,” Wilson said.
“What we have to do is try to get these opportunities, these exportation initiatives, from being No. 11 on their top 10 list of things to do and bring it up to No. 8.”
Wilson went on to say that too often Northwestern Ontario companies are left behind on trade missions to mining hotbeds, not because the ministries involved don’t want them, but because the companies just don’t see the value or feel they can spare the time.
“When I take a look at the lists of the companies that are going, there’s nobody in the 807 area code. We’ve got to get a couple of our companies that are willing to take that next step. They’ve got incredible products, services and abilities, but you’ve got to get to that next step on the stage, go down there, see what’s going on, come back and tell the other companies, wow, this is even bigger than we thought.”
Follow Leith Dunick on Twitter: @LeithDunick
