Since the coronavirus outbreak happened, most of the events have been canceled, including this year’s expo following the 2019 E3 Conference. But, not only activities were affected by the pandemic, but the mining industry as well.
Decline In Supply
The restriction on mining activities is causing a decline in supply, although mining operations continue in some countries. But since there is a slowdown of economic activity, the demand for minerals falls as well. So, the reduction of supply has not hugely affected mineral prices.
Critical Supply For Critical Metals
Before the coronavirus, the supply for critical metals, such as lithium, cobalt, nickel, and neodymium, is facing a threat. Meanwhile, minerals like cobalt are mostly from Chinese companies. Now that mining operations are on a standstill for most sites, the fear of emptying the supply further grows. These metals are essential for renewable energy and technology industries.
Likely, U.S. companies needing these critical metals will soon venture into mining to ensure that they have enough supply to continue manufacturing their products. Pentagon, on the one hand, made a deal with Lynas Corp. to secure their supply for these critical metals.
Rising Of Gold Prices
Gold is a tool used to obstruct economic uncertainties and inflation. Since economies are on a downturn because of the pandemic, gold prices are soaring. As inflation happens, gold becomes more expensive, then owners of gold are protected from the effects of inflation.
Gold is highly reliable and a haven in terms of investment. Unlike stocks, gold is unaffected by the economic crisis that is happening. While it is a precious mineral that is exchanged globally, there is only a finite supply, which makes it dependable storage of fortune.
Nations and industries are struggling to stay afloat since this health crisis brought about by the coronavirus have now become an economic crisis. The mining industry must craft new ways to be able to respond to the crisis and survive.