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Competitiveness
Europe is rich in natural resources and the extraction and
supply of minerals continue to play a crucial role in the
European economy and society as it has done for thousands
of years. Minerals are used in every-day life, as construction
materials (crushed rock, sand and gravel) for infrastructure,
buildings, and roads, and for industrial purposes (e.g. metals,
lime, kaolin, silica sand, talc) in the production of steel,
cars, computers, medicines, human and animal foodstuffs, and
fertilisers to name a few. To a large extent, demand for the
wide range of minerals produced in the EU is strongly influenced
by the business cycle of downstream sectors, such as the construction
and steel-making sectors. In this respect, the industry differs
from many other forms of manufacturing.
The non-energy extractive industry in Europe, that is excluding
minerals used for fuel is usually divided into three sectors:
metallic minerals, industrial minerals and construction materials.
Total turnover within the sector in 2001 was 36.3 billion
€. The number of people recorded as employed in the non-energy
extractive industry in 2003 was 245,000. Of these, over 200,000
worked in the construction minerals sub-sector. It is estimated
that the indirect employment provided by the industry is up
to 4 times than the directly employed.
The three sectors are characterised by their exceptional diversity.
The construction minerals sector is by far the largest in
terms of tonnage and sales revenue. It consists predominantly
of small and medium sized enterprises with over 20 000 sites
supplying local and regional markets with materials such as
sand and gravel and crushed rock (aggregates) for construction,
railway ballast and armourstone for flood and coastal defence.
It also provides the raw material used in the manufacture
of other vital construction products such as ready-mixed concrete,
asphalt, lime and cement. There is also a number of multinational
quarrying companies, which supply more distant markets. Substantial
amounts of sand and gravel are also extracted from the seabed.
In general, the widespread distribution of sand and gravel,
and hard rock resources, and the relatively low price of the
product, means that transport costs significantly influence
the marketability of these products. EU production in this
sector meets over 20% of global demand.
The industrial minerals sector provides a wide range of minerals
which can be loosely classified as either ‘physical’
minerals, that is, minerals valued for their physical properties,
for example, calcium carbonates, diatomite, kaolin, plastic
clays, bentonite, feldspar, silica, and talc or; ‘chemical’
minerals, that is minerals valued for their chemical properties,
for example, borates, salt, potash and sulphur. Extraction
is undertaken in all of the current EU Member States, although
some countries have more significant production than others.
There is a highly developed international trade for some industrial
minerals. This sector in the EU is mainly composed of small
and medium-sized enterprises. However, it also includes some
of the world's leading international production companies,
operating on a global basis such as in talc. Processing of
the minerals before sale can be relatively simple (mainly
crushing, grinding and classifying) but may also be more sophisticated
for some mineral types (e.g. mineral sorting by flotation,
laser optics, magnetic separation, or calcination). The EU
metal mining sector is composed of around 250 enterprises,
which include some of the major multinational mining companies,
which have their headquarters located in Europe. European
companies compete in a global market and the majority of metallic
ores are imported to supply the demand of the European metal
industries. The EU metal mining sector accounts for some 3%
of world production, located in many but not all of the EU-15
countries, particularly in some of the more Northern countries,
such as Sweden and Finland and the Southern countries of Greece,
Spain and Portugal. New mines continue to be developed, and
provide employment and economic growth in regions, which would
otherwise have difficulty in attracting other investment.
Since metals, their ores and concentrates are traded on international
markets, European metal mines face strong competition from
large-scale, high-grade overseas operations capable of producing
metal ores and concentrates under low cost competitive conditions.
The EU sector has made substantial efforts to reduce operation
cost levels through rationalisation, innovations and increasing
capital intensity.
Overall the minerals trade balance is negative, showing a
strong dependence of the EU on imports for its raw material
supply.
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