This Too Shall Pass
Here we are once again, staring at the teeth of the tiger. The last time was 2008 as the global financial crisis ( GFC) was about to take down commodity markets and the economy with it. Many of the major mining companies, which were flush with cash at the time, did not feel the immediate effects of the credit crunch. They would eventually suffer from the economic slowdown, but they had the ability to pause and apply reason when others were operating in a state of panic.
The fear brought about by the coronavirus (COVID-19), which is a health crisis, not a financial crisis, has drawn a similar, measured response from leaders in the mining business. As the healthcare systems in large metropolitan areas were overrun with COVID-19 cases and death, miners around the world had a slight advantage with operations in remote low-risk locations. They faced a self-preservation choice: idle assets for 14 to 21 days (or perhaps longer) or continue to operate, while implementing healthy operating conditions, such as improved sanitary practices and social distancing. Some mining operations had no choice as governments mandated shutdowns.
Many mining companies are doing the right thing, right now. Several examples are profiled in this edition. (See COVID-19) That article mentions BHPís new CEO Mike Henry and the much-needed advice he offered on the importance of maintaining mental health during this difficult period. Itís important to stay positive and take care of yourself mentally as well as physically and check on others. We could have easily filled every page in this edition with negative stories about mine closures in the affected areas and fanned the flames of hysteria, but we elected to look at the positive side of what was happening in the field as this edition went to press. We would also suggest you do the same. Rather than exposing yourself to the constant barrage of bad news in the mainstream media, tune in long enough for an update and then tune it out. If you want a break from the boredom of isolation, reach out to family, friends and peers to check on their well-being.
Moments like these define the character of an individual as well as an organization. Furloughing thousands of employees may preserve the business model. Thatís a difficult choice that many mining executives may face. Will they return when the economy recovers? The knock-on affect of those job losses will be devastating to surrounding communities. If those decisions must be made, it would be wise to describe them as temporary layoffs.
Hopefully, COVID-19 will soon run its course and the world can try to return to a new normal ó whatever that may be. This too shall pass. The global economy will come roaring back and it will need more mined commodities than ever before.
Take care, stay safe and be kind. Enjoy this edition.
Steve Fiscor, Publisher & Editor-in-Chief, E&MJ