According to a survey of miners in October and November 2023, fuel and power costs remain the area where prices are increasing the most.

When asked where they were seeing the greatest increases in mining operating costs at present, 69% selected fuel and power as one of the top three areas, just ahead of maintenance parts/repair (65% of respondents) and then explosives (28%).

The ranking was similar to the results of another survey conducted in the first quarter of 2022, although the share citing fuel/power was lower, down from 88%, helped by a decline in oil prices since the highs seen in mid-2022.

Overall, 24% of respondents included labour as one of their top areas for cost increases, a similar share as in 2022 while wear parts were cited by a higher share (21% in 2023 versus 11% in 2022) and tyres for a lower share (15% in 2023 versus 35% in 2022).

Overall, the increases being experienced for all cost areas were not as severe in 2023 as in 2022.

For example, for fuel and power, in 2022, some 89% of respondents had experienced fuel and power price increases of 11% or more over the previous year, but this share was down to 52% in 2023, and those citing an increase of more than 30% in costs was down from 48% to 17%.

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By GlobalData

Price increases are still encouraging miners to seek out new suppliers. Overall, 40% strongly agreed and 35% agreed with ‘We have looked for alternative suppliers more this year than before because of higher prices’.

Some 83% confirmed they had specifically looked for a new supplier for maintenance parts/repair, up from 70% in 2022 while 67% had looked for new suppliers for both wear parts and other consumables (reagents and lubricants for example), albeit down from 70% and 75%, respectively, in 2022.

The share looking for a new supplier for fuel/power was also down, at 36%, versus 45% in 2022.