The global mining equipment market is expected to reach USD 1501.1 million by 2026, growing at a CAGR of 1.8 percent during 2021-2026. Ongoing digital mine innovation is anticipated to transform the key aspects of mining in the coming years. Other factors such as increased investment, with government support for the digital mine innovation, are expected to augment the demand for mining equipment over the forecast period.
The surge in mining activities mainly for extractions of metals and minerals to grapple with the increase in demand for both metals and commodities are the major reasons for the growth of the mining equipment market. Moreover, the adoption of numerous technologies that include automation Internet of Things has led to a reduction in labor cost and operational time, which are associated with mining activities. And, this is predicted to shoot up the demand for innovative mining equipment.
Lastly, the increase in consumption of natural resources, and soaring need for mineral
fertilizers to improve agriculture yield are significant factors anticipated to surge the demand for global mining equipment.
However, stringent government regulations related to environmental concerns, safety standards, and import regulations are anticipated to hinder this market growth.
The COVID– 19 Pandemic is posing significant threats to worldwide trade, economy, and finance. Not just that, it has also shut down the production of various types of mining equipment, due to prolonged lockdown in many countries. This has hampered the growth of the mining equipment market significantly over the last few months and is likely to continue.
According to ICRA, the domestic mining and construction equipment industry is most likely to observe a 20 percent volume decline because of the loss of sales it faced in the month of April and May.
“The MCE (Mining and Construction Equipment) industry witnessed some demand recovery in June 2020 after a prolonged downturn, driven mainly by rural demand for construction equipment (CE). It was found that rural demand has gone up with higher vehicle utilization levels and has been trending since May 2020 led by agriculture, irrigation, canal cleaning, and mulching activities. However, while the revival during the month of June is no doubt a positive sign, it is in no way conclusive; the same has to be sustainable in the near to medium term and much will be contingent on the underlying economy and headroom for infrastructural spend,” said Pavethra Ponnaih, Vice President and Sector Head, ICRA.
The ICRA also stated that demand for Mining and Construction Equipment is firmly associated with economic activity and government and private investments in infrastructure and other long-term fixed assets.