Mining equipment suppliers caught in vicious spiral
Mining equipment and services firms are being buffeted from all sides and the crude oil slump could't come at a worse time:
"Traditionally, the industry has taken all the risk and service providers have had a jolly good time. Now we demand that they partner in our risk," said Mark Bristow, chief executive of Africa-focused gold producer Randgold .
Competition among suppliers has been stiff for the last few years, as mining firms began to come under pressure from investors to cut back. They have already slashed a total of $20-25 billion (13-16 billion pounds) in costs, according to Ernst & Young.
But a further plunge in prices this year has made the pressure relentless — just at the time when the oil sector too is suffering, forcing its own suppliers to consolidate.
Continue reading at The West Australian.