It wasn't pretty in the mining industry during 2014 or 2015.
Producers of rubber products such as conveyor belts for the mining industry experienced very difficult times. Added to the companies' displeasure has been the downturn in the oil and gas sector, where a number also have a stake.
Expect more of the same in 2016, although there could be a slight improvement, some manufacturers of rubber goods said in recent interviews. But then again, anything is an improvement over dismal.
For the mining industry globally, a bad year ended on a bleak note. Mine giant Anglo American said in early December it would cut as many as 85,000 jobs from its work force of about 135,000 as it overhauled its business. A drop in commodity prices led to that decision, according to the London-based firm, one of the world's largest mining companies.
Anglo American officials said the firm planned to sell parts of the business—including possibly coal and copper mining operations—but added that further details would not be available until later in February.
ContiTech A.G., one of the largest conveyor belt producers in the world, does not foresee a significant improvement in 2016 globally or within North America, where it gained a large base when it completed the purchase of Fairlawn, Ohio-based Veyance Technologies in January 2015. It already had a solid presence in the belt market in Europe and Asia.
Global demand for mining commodities remains stagnant, a ContiTech spokeswoman said, and has negatively impacted the company's sales. “We believe the overall mining market will recover on a medium-term perspective.”
There is potential for some mining segments to do better if external conditions significantly change and things break right, she said.
She said the firm's heavy duty belts mainly are produced for the mining industry, but there are other industrial fields where the company has a strong presence, such as bulk material handling for above-ground activities or cement plants.
Being versatile and producing products for numerous sectors has helped ContiTech maintain balance and profitability during the long slump.
“Currently our business with the automotive industry is developing well,” the spokeswoman said. “Based on our past experience, we are able to balance economic fluctuations with our broad positioning. That is why our strategy is based on being active in different industries. That is a big, unique advantage that we have at ContiTech.”
Despite that versatility, the company closed its Bowmanville, Ontario, conveyor belt plant in November because of the continued global downturn in the mining sector, in particular the coal industry in North America. About 135 employees were affected.
Hannes Friederichsemn, head of the firm's conveyor belt group, cited decreasing demand for mining materials in discussing the closure. He noted that 71 major mines in 2016 worldwide were forced to shut down, “with 17 closing between July and September alone.”
ContiTech, which has its U.S. and NAFTA headquarters in Fairlawn, said it would relocate production of heavyweight belts—both steel and fabric—from Bowmanville to other company plants in the region.