While South Africa’s crushing, milling and screening sector is in maintenance and operation mode, projects in countries such as Tanzania, Zimbabwe, Malawi, Madagascar and Mozambique are experiencing capital growth, owing to greenfield developments which are contributing directly to the gross domestic product (GDP) and sectoral diversity of these countries’ economies, says independent process industry consultant Santosh Gunpath.

He expounds that, in these countries, projects necessitate an increase in manufacturing; tax is generated for the host country from operational revenue when the product is sold/exported; and there is increased infrastructure development around the project’s geographical location.

In contrast, local crushing, milling and screening participants do not have projects under way that could contribute directly to the country’s GDP. Instead, these form part of the overall contribution the mining industry makes to the economy. Gunpath highlights, moreover, that, while crushing, screening and milling service the mining industry primarily, they also play a role in the industrial and manufacturing industries.

“It must be understood, however, that the mining sector cannot function without the essential part of the process flowsheet of crushers, screens and mills. It will always have a place in the industry as an indirect contributor,” he adds.

Gunpath emphasises the value of crushing, screening and milling to the mining industry, as collectively, these processes form an integral part of most mineral processing applications. Extracting valuable minerals from mined ore requires a combination of crushing and milling – also known as grinding and comminution – whereafter the ore is sized using screens, he notes.

He indicates that these three processes are used to process the country’s major commodities, namely gold, platinum, coal, manganese and iron-ore, while coal uses only screening.

As such, Gunpath indicates that South Africa, as well as other countries, remains reliant on these processes, which will continue until the various mineral processing operations where they are used have reached their end of life and are decommissioned.

Processing Players

Gunpath highlights global industrial equipment company Metso, supplier of engineering, equipment and service solutions FLSmidth and process technologies and services provider Outotec as the prominent, enduring companies providing crushing, screening and milling solutions to the South African market.

He highlights Metso, industrial equipment supplier Weir Minerals and vibrating equipment manufacturer Vibramech as the major local screen suppliers, while milling and grinding media provider Magotteaux is one of the biggest suppliers in terms of steel balls used for crushing.

Gunpath emphasises the importance of such suppliers to the local mining industry, as all mineral processing plants use these products.

In crushing, milling and screening industry, he says original-equipment manufacturers (OEMs) are now mainly focused on spare parts to keep existing mineral processing plants in operation. He laments that, owing to minimal or no investment in new mineral projects in South Africa, the scope for expanding the crushing, milling and screening equipment base is “negligible”.

Gunpath asserts that the state of the mineral processing industry is well known to the various OEMs that serve it, which are, subsequently, refocusing their business models to support aftermarket spares for the South African market. “If it were not for maintenance of continuing local operations, the industry as a whole would stagnate and come to a grinding halt.”

Further, OEMs are seeking new capital installations in international markets, which he defines as the rest of Africa, specifically north of the Limpopo river.

Gunpath indicates that OEMs bidding for projects offshore still do so based on local manufacturing capacity, which further supports the job market and contributes to the country’s GDP by providing the manufacturing industry with much-needed revenue.

He emphasises that growing the crushing, milling and screening sector locally remains a key challenge. “New projects would mean growth, but this is sorely lacking.”

He says the current oversaturation of the market is the biggest challenge for OEMs, particularly the mid- to large-tier OEMs. “When I conducted a high-level screen supplier survey, there were at least 27 screen suppliers. This is excessive for a stagnant market.” He notes that many of these are low-cost manufacturers who sell to the market at low profit margins, thus, driving down margins of the more reputable OEMs and, thereby, creating an unsustainable price war.

Suppliers of larger equipment, such as mills and crushers, experience oversaturation to a lesser extent, as the capital cost to “tool up and work with exotic materials of manufacture” to sell to this market is high and, thus, a barrier to entry, Gunpath indicates.

“As a whole, the industry is facing a decline in demand for goods and oversaturation. Part of the reason for this is the regulatory environment fuelled by politics and people’s need to do anything to generate income, hence, the price war.”

“The industry is facing headwinds with regard to capital investment. As a country heavily dependent on minerals, government either needs to support this industry or find alternatives to ensure economic growth, avoid a recession and stave off a further ratings downgrade,” Gunpath concludes.