Most of the world’s biggest mining companies, and many smaller mining companies, are listed on the London Stock Exchange, including its Alternative Investment Market (AIM). (For an explanation of AIM, click here.)
London is the world’s biggest centre for investment in the minerals industry: British high street and investment banks (like Barclays, HSBC, RBS, Citibank and Standard Chartered), pension funds, hedge funds and insurance companies invest hundreds of millions of pounds a year in scores of dubious mining projects across the globe, connecting working people’s earnings in Britain with the fate of mining-affected communities around the world. (For more information about the links between investors and mining companies, see the continuously updated wiki by Nostromo Research, From Money to Metal.)
The mining industry’s key lobbying organisation, the International Council on Mining and Metals (ICMM), is based in London. So are the world’s most important metals price fixing mechanism, the London Metal Exchange, and the leading precious metals trader, the London Bullion Market Association (LBMA). (For a short history of the London Metal Exchange, click here.)
British-based mining companies deliver two thirds of global iron ore output, the majority of the world’s diamonds, platinum and titanium, and a significant proportion of other metals and minerals.
Mining is one of the most polluting industries in the world; has a disproportionately negative impact on land-based communities, especially Indigenous Peoples, and is frequently associated with forced evictions, militarisation, conflict and human rights abuses.
Use of coal in energy generation is a major contributor to destructive climate change; use of uranium produces a radioactive legacy which threatens the wellbeing of thousands of generations to come.
The British government has consistently backed UK mining companies, despite the many accusations laid at their doors.
Who controls what?
Coal: In 2007, among the biggest global producers were Peabody Energy (US), Rio Tinto (UK/Australia) and BHPBilliton (Australia/UK). Xstrata (UK/Switzerland) claims to be the biggest exporter of coal.
Iron: More than two thirds of all global iron ore comes from just three companies: Brazil’s Vale and London-listed BHPBilliton and Rio Tinto
Gold: Barrick Gold (Canada) is the world’s number one gold miner, then Newmont Mining (US), AngloGold Ashanti (South Africa), Gold Fields of South Africa , Freeport McMoran (US), Harmony Gold (South Africa), Navoi Metal and Mining (Uzbekistan), Compania de Minas Buenaventura (Peru) and Rio Tinto. Of these, Rio Tinto is headquartered in London and AngloGold Ashanti has a subsidiary listing on the London Stock Exchange.
Diamonds: By volume Rio Tinto is the global leader. By value, De Beers (South Africa/UK) (5) is the biggest profiteer (with more than 70% of the market) followed by Alrosa (Russia) and Rio Tinto.
The Global Top Ten Mining Companies
In September 2011, the Financial Times Global 500 included five London-listed mining companies among the world’s top ten mining companies by market capitalisation (total share value).
The top ten were as follows – all figures are in billions of US dollars and rounded off to one decimal figure.
1) BHP Billiton (Australia/UK) 166.5 (listed in London)
2) Vale (Brazil) 118.4
3) Rio Tinto (UK/Australia) 91.1 (listed in London)
4) Barrick Gold (Canada) 47.1
5) Glencore (Switzerland/UK) 46 (listed in London)
6) Anglo American (UK) 46 (listed in London)
7) Norilsk Nickel (Russia) 41.5
8) Xstrata (Switzerland/UK) 37.5 (listed in London)
9) Potash Corp of Saskatchewan (Canada) 37.4
10) Goldcorp (Canada) 37.3
Anglo American’s Anglo Platinum subsidiary came in 17th at $18.2 billion. If this is added to Anglo American’s market capitalisation it increase it to $64.2 billion.
London-listed AngloGold Ashanti came in at 24th with $16 billion.
In January 2011, four of the world’s top five mining companies (by market capitalisation) were listed on the London Stock Exchange (the exception being Vale). The market capitalisation of these top five mining companies (in billions of US dollars) was, according to mining analyst Barry Sergeant of Mineweb:
1) BHP Billiton (Australia/UK) 242.19
2) Vale (Brazil) 182.83
3) Rio Tinto (UK/Australia) 143.30
4) Anglo American (UK) 69.37
5) Xstrata (UK/Switzerland) 69.13
If Anglo American’s South African subsidiary Anglo Platinum market capitalisation is included in Anglo American’s, the value rises to 96.96 billion US dollars.
For purposes of comparison with the figures given above, in October 2008, the market capitalisation of the top five mining companies (in billions of US dollars) was:
1) BHPBilliton (Australia/UK) 180
2) Vale Inco (Brazil) 76.50
3) Rio Tinto (UK/Australia) 70.21
4) Anglo American (UK) 39
5) Xstrata (UK/Switzerland) 39
By December 2008, according to Mineweb, this had changed to:
1) BHP Billiton (Australia/UK) 94.16
2) Vale Inco (Brazil) 49.25
3) Shenhua (China) 44.88
4) Anglo American (UK) 26.28
5) Rio Tinto (UK/Australia) 23.08
Xstrata had fallen to 12th place, at 9.40.
By mid-February 2009, according to Mineweb, it had changed again to:
1) BHP Billiton (Australia/UK) 110.53
2) Vale (Brazil) 77.03
3) Shenhua (China) 50.02
4) Rio Tinto (UK/Australia) 40.84
5) Barrick (Canada) 33.66
Anglo American was sixth at 25.22 and Xstrata 17th at 10.52.
By July 2009, according to Mineweb, the top five were:
1) BHPBilliton (Australia/UK) 142.90
2) Vale (Brazil) 93.36
3) Shenhua (China) 76.77
4) Rio Tinto (UK/Australia) 68.05
5) Anglo American (UK) 39.36 (but if South African listed Anglo American subsidiary Anglo Platinum is included, Anglo American’s market capitalisation was 55.96 billion US dollars.)
By May 2010, the ranking was as follows:
1) BHP Billiton (Australia/UK) 154.93
2) Vale (Brazil) 128.73
3) Rio Tinto (UK/Australia) 99.65
4) Shenhua (China) 58.13
5) Anglo American (UK) 47.34 (but if South African listed Anglo American subsidiary Anglo Platinum is included, Anglo American’s market capitalisation was 71.01, putting it in fourth place)
London-listed UK-Swiss company Xstrata was at number 8, with 38.41 billion. Two Canadian companies with London-based financial backing were at numbers 7 and 8: Barrick (40.76 billion) and Goldcorp (30.16 billion).
For further details, see http://www.minesandcommunities.org/article.php?a=9202
UK-listed mining companies together enjoy around half the market capital available to the world’s ten biggest miners.
* The mining industry’s single biggest source of finance is the London Stock Exchange (LSE) followed by Toronto’s. The majority of “junior” mining companies are also registered in Toronto with significant listings in Australia and on London’s fast-growing Alternative Investment Market (AIM)