The North American mining market in 2019 operated on par with the previous year, and the steady trend is expected to continue this year.
There was some weakness at year-end, in coal mining, according to Bruce Besancon, vice president of OTR tires for Yokohama Tire Corp., but he noted that coal will be in demand for the near future as there still are coal-fired electricity plants and export potential.
"The companies that have been in mining historically are, for lack of better words, the winners of mining," he said.
He predicted that top-tier mining companies have survived the consolidation of a few years ago, but smaller players, perhaps in the coal industry, might continue to experience consolidation or mergers.
The U.S. Energy Information Administration estimated that U.S. coal production declined 9 percent in 2019 and expects U.S. coal production will drop by a further 14 percent this year because of anticipated declines in both exports and domestic consumption in the electric power sector.
The EIA expects the largest declines in coal production in 2020 will occur in the Western production region. The coal market has undergone significant restructuring in the past year.
"Overall, 2019 was a positive year for the mining industry. We saw tire consumption growth and tire supply improvement," Jake Thompson, B2B mining business segment marketing manager, Michelin North America, said.
And, while 2020 is a presidential election year—which can present obstacles in the market, he still expects to see growth this time around.
Besancon expects the mining industry in 2020 to be fairly stable, but he does see potential for a slight downturn in the coal market.
He said there always are concerns during a presidential election about what the next administration will bring. The Trump administration has been a bit more friendly to coal and there have been fewer concerns about coal mines getting shut down, he said, and fewer concerns about environmental regulations, available lands, permitting, etc.
"In the mining industry, we, overall, expect the market to remain flat in 2020," said Tim Netzel, marketing director, off-the-road, U.S. and Canada, at Bridgestone Americas Tire Operations.
"According to the U.S. Bureau of Labor Statistics, the mining industry has seen a slight uptick in employment, with the addition of approximately 200 jobs, since 2018. This, coupled with a stable commodities market in 2019, suggests the mining industry will hold steady through 2020."
Trends in mining
"In the past, we have seen the overproduction of OTR tires in the mining industry," Michelin's Thompson said. "As we enter 2020, we do not see overproduction. Certain customers could have a little more inventory or less, but the market seems to be aligned between tire consumption and production."
In the North American market there is no shortage of tire dealers catering to the mining industry, and the mature tire dealers who have been in the mining tire business for a long time are growing their businesses, according to Besancon.
"I think there has been a refining of the dealerships who specialize in that. ... (Mining companies) are expecting their vendors, including the tire dealers, to make sure they have safe, trained workers, efficient workers who are productive and know exactly what they are doing.
"In the mining world that is a specialized task, and I think that the dealers that are in this are investing in making sure that they've got good workers, they've got productive workers and knowledgeable workers who have been trained to know how to work in that environment through all the protective gear, through all the regulations that they have. And I believe that's a core concentration that these dealers have specialized in.