Explosives are used in mining site to break through rock formation for excavation.
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Omnia secures JV with Indonesian mining explosives businessMarch 31, 2023
Orica introduces 4D? bulk explosives system for underground operationsMarch 31, 2023
Digital Terrain completes acquisition of explosives magazine management software specialist MagmanMarch 31, 2023
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Explosives market report transcript
Global Market Outlook on Explosives
Global Supply: 14.65 MMT (2022E)
Global Demand: 13.59 MMT (2022E)
Global Demand CAGR: Approx. 3.5–4 percent (2021–2024)
The demand for explosives is driven by rising commodity consumption levels from China, India, and other Asian countries. This scenario is expected to continue in 2022 with higher demand from countries, like India and China
A constant rise in commodity demand, coupled with increasing mineral output, and declining ore heads are the key drivers for explosives
Global Explosives - Drivers and Constraints
Increase in Commodity Demand
The mining industry is expected to witness a 22 percent increase in capital expenditure in 2022, as overall prices and demand for metals and minerals are expected to improve in 2022
Commodities, such as copper, gold, iron ore, etc., have a positive impact on demand for explosives, due to the expansion of mining activity
Rise in Commodity Prices
It results in high-profit margins for mining companies, which triggers Greenfield and Brownfield mine project expansion
Major explosive manufacturers invest significantly in R&D in order to develop innovative products, which improves the efficiency of blasting as well as result in lower GHG emissions. This helps the mining industry meet the emission targets
Decrease in Mineral Output Growth Rate
It will result in a reduction in mineral output from mines, adversely impacting explosives demand
Regulations and Complexity in Transportation and Logistics
Increasing security and safety regulations have had a negative impact on the sales and supply of explosive products, especially in mining destinations, such as Africa, LATAM, etc.
Such stringent regulations affect the supply security and have impacted blasting services cost significantly
The global shift toward phasing out the use of coal for energy needs would significantly impact the demand for explosives, as coal mining industry is the largest end-user of explosives at present
Market Driver - Commodity Price
Prices of key commodities are the best indicators of mining activities, which, in turn, evinces the demand for explosives
Iron ore prices have increased by 19.5 percent and averaged at $111/MT, due to improved demand from the end users
LME Nickel prices averaged at $13.17/lb. in December 2022, a monthly rise of around 12.2 percent compared to $11.56/lb. in Nov 2022
Cost Structure Analysis : Explosives
Feedstock raw materials are the key cost drivers for explosives, as they constitute to ~60–70 percent of the total production cost across all regions.
The profit margin for explosives in a particular region is set up by the supplier, based on demand from the customers in that region and competition among the suppliers
Other costs are inclusive of logistics, warehouse cost, and other direct and indirect expenses
Utilities mainly include storing of AN prill at the appropriate temperature, as it should not be subjected to extreme external conditions of rain, high humidity, etc.
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