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The metals and minerals market: opportunities and uncertainties

Roberto Cordero Piazze, VP of the Latin American Operating Group for Cotecna, discusses the uncertainties and opportunities of the Metals and Minerals market in Latin America.

The Metals and Minerals market in Latin America is going through a complex moment of uncertainty, characterized by a highly vulnerable political context, with governments weakened both in financial terms and in their citizen approval due to an increase in social unrest, which has worsened due to the Covid-19 pandemic. This has led to changes in regional political contexts with a bias towards leftist sectors, which have defined campaign proposals that involve increasing tax rates on mining to increase tax collection to cover social development programs. This has significantly slowed investor decision-making at a time when metal prices are booming.

Despite the political context of the region, as economies begin to emerge from the stages of confinement, it is expected to achieve a greater recovery in demand, which would translate into increased pressure on supply chains that they still have difficulties because of the pandemic and, therefore, this could lead to a greater increase in prices. This is reinforced by the consideration that we are in the early stages of a global restructuring driven by decarbonization, electrification and stimulus measures aimed at infrastructure to promote growth.

This context of uncertainty has led the mining industry to focus on the optimization of production processes, on a strategic level, in order to overcome the challenges of political and social volatility, maintaining a low profile, with cost levels controlled and in line with current production volumes, as well as low risks in capital management, a situation that has forced Testing, Inspection and Certification (TIC) companies to reformulate their strategies, with the purpose of adapting to the new market context.

These new strategies are mainly aimed at incorporating technology into its services, increasing response capacity and speed, to increase customer satisfaction through fast and personalized service. In addition, the local and global presence constitutes a great added value since TIC companies can globally support a tailor-made local service.

The Cotecna group with its more than 45 years of history has become one of the leading companies in the TIC business sector. In its quest to sustain growth and take advantage of the opportunities of a world in motion, it has proposed a new growth strategy for Latin America based on the establishment of personalized services that incorporate innovation initiatives such as artificial intelligence and machine learning. This strategy enables Cotecna to reduce the risks of exposure of employees, while being able to improve the efficiency of productive processes of its clients. Likewise, an ambitious goal has been proposed to expand its coverage and the diversity of its portfolio in the region, through an aggressive acquisition plan.

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