Introduction to the Mining Industry

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The mining sector is made up of organisations whose primary activity is the extraction of naturally occurring mineral solids or natural resources. Examples of these types of minerals are coal, ores and precious stones. The mining industry also broadly covers quarrying and well operations. The sector comprises two basic activities: mine operations and mining support activities.
"Mine operations" involve setting up the mine, quarry or well for the organization, or on behalf of another organization for a small fee.
"Mining support activities" are those operations that must be carried out before mining begins; exploration and other services (except site preparation and construction of oil/gas pipelines).

The mining and metal industry is made
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Therefore there will always be a demand for mining products. There are not too many competitors as certain materials can only be mined in specific areas.

Supplier power
Supplier power is quite high in mining as most of the worlds mines are owned, or part owned, by three of the largest mining companies in the world; Rio Tinto, BHP Billiton and Anglo American.
Also, as mining is one of the primary activities, there are not many suppliers. The only possible exception is that of the machinery suppliers, but since this is so specialized, they will have little power over the huge multinational corporations that are the mining companies. The suppliers of mining equipment, for example Caterpillar, have little power because contracts with mining companies go in to millions of dollars and those who supply equipment don't want to lose any potential customers.

Threat of entry
In the mining industry the treat of entry is very small this is due to the extensive capital needed in order to start operating a mine.
Costs include:
- Training of employers and staff.
- A strong team of well paid engineers, scientists and managers.
- The cost of the machinery.
- Maintenance costs.
- Propriety costs

Large companies,
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