Finance
The mining industry was battle tested in 2014 . The prices of iron ore and gold deteriorated , reaching record lows and forcing many companies to cut costs and postpone projects in order to survive . The volatile market forced companies to expand projects in an effort to reclaim profits while others upgraded outdated technology and machinery to improve productivity . It was a rough year to say the least .
“ We believe the situation is unlikely to improve in the near to medium term ,” ANZ ’ s head of Australian economics , says Justin Fabo , ANZ ’ s head of Australian economics - corporate and commercial .
While the good times for commodity prices may be a thing of the past , there are marginal signs that show otherwise . Prices are slowly moving in the right direction , global operations are starting to regain steam and there ’ s even speculation of a few block-buster mergers on the horizon .
Will 2015 be any different ?
The future of gold Gold dropped to a new four-year low of $ 1,160 per ounce earlier this month and the downward spiral has many analysts expecting a grim 2015 outlook . The base metal has seen a consistent slide in price , dropping five percent in November and industry experts believe it will fall in the short term to the $ 1,100 mark .
There is positive news , however . According to IBISWorld research , the price of gold is expected to increase in 2015 to an average of $ 1,411 per ounce as the global economy improves and inflationary pressures ease with higher interest rates . BISWorld believes 2015 will be the first for revenue growth in the gold sector since 2011 .
Despite the increase , gold is expected to decline over the next five years “ with higher costs contributing to profit declining to a forecast 7.6 percent of revenue in 2020 . It appears gold will settle at around the $ 1170 mark in 2015 . Unfortunately , those prices are well below production costs .
Iron took a massive beating in 2014 . The steel-ingredient , which began declining in 2011 , plummeted to double digit territory in May of this year and the outlook in 2015 is not good . Iron ore was one of the
18 J anuary 2015