We sat down with our CEO, Nick and Chief Commercial Officer, Elliot to dive into the recently published Axora Innovation Forecast. Our ground-breaking market research and insights followed a survey of 160 mining industry leaders in March 2023, from across the world and multiple roles in HQ and ‘on site’. You can download and read for yourself here.
Axora Q: So, Nick and Elliot, we’ve published our latest market research and insights recently. What do you think this publication brings to the mining industry?
Elliot: We’re proud to see it in its 3rd year now, and as we’ve matured in our survey and interpretation of the data, we have become more confident in the conclusions. This is backed up, of course, by our continued ‘hands on’ insights development, visiting mining companies and sites more regularly than ever. I believe there is no other research about technology innovation in mining that provides both global and localised sets of insights into trends, barriers and priorities. It also is deliberately geared to help organisations take real action on innovation.
Nick: Adding onto Elliot’s thoughts, there are some great pieces of mining market research done every year – we love them all – but Innovation Forecast is perhaps uniquely placed to really dive into how technology is being used, and not in some cases, to drive innovation towards better safety, sustainability and of course efficiency.
Axora Q: As you mentioned previously, Elliot, you are talking every day to mining people, both in HQ and mine site roles. How does the research correlate with what you hear on a day-to-day basis directly from the people in the industry?"
Elliot: As an example, I’ve recently been spending time in South Africa and with a range of the South African mining people, and it’s fascinating for me to initially compare what I hear going on in the country with the global insights. We deliberately surveyed a high % from South Africa, 40 of the 160 people, so we have a reliable set of insights for this amazing country.
At a high level, 2 local insights correlate very well with the overall insights in Innovation Forecast. Firstly, we are well aware of the tension that can exist between mine site and HQ. It’s not a unique challenge to mining – I have a long history in executing complex IT projects and have seen this in multiple industries. However, the pressure on mining HQs for decarbonisation is very real, including in developing markets like South Africa. This we know is coming from investor, government and local community pressure. We see, particularly in South Africa, how difficult it can be to try and reduce carbon emissions whilst dealing with the energy crisis with a heavy reliance on sources of fuel that directly impact the environment.
When we talk to people at mine sites, in general at least, the pressure is at best ‘growing’ into a priority, but they continue to be under enormous pressure on throughput, which has always been the primary currency of a mine site. We expect to see these level out over time as alignment improves.
Secondly, the innovation agenda is definitely growing faster than 3 years ago – it’s not entirely driven by ESG but of course that is part of it. Continued volatility in minerals pricing, energy security demands and many other macro factors are driving the urgency to constantly improve operations. Naturally we are beginning to see the first stage of ‘AI maturing’ that is powering a new generation of what were bleeding edge optimisation solutions a couple of years ago, to be much more accepted. At one mine operation, an AI solution gave a processing optimisation of only 1%, which was valued at $69m of economic benefit. We’re excited to be there at the forefront of this important trend and opportunity, embraced by South African mining and all around the world. I also visited a mine which was purpose built with AI and technology at the forefront of the design. We are seeing more and more greenfield mines taking this advanced approach rather than the traditional designs.
Axora Q: Nick, what was your biggest surprise this year’s survey?
Nick: There were a few but the one that really caught my imagination was the big jump in perceived disconnect between HQ and mine site goals, globally. As Elliot said, we hear about the pressures mine sites are under just to do the ‘day job’, when of course their corporate colleagues want to drive transformation. This is natural and any large organisation has a bigger ‘change drive’ from corporate than naturally closer to the coal face, excusing the pun. In 2022, we asked, “Is there a disconnect between corporate innovation goals and mine site goals?” and 71% of respondents said yes – a fairly high number given we were surveying across both roles. In 2023 that 71% became 85%, and I had not expected such a big jump. Whilst there is always the need to recognise statistical significance in a survey of less than 1000s of people, there is no doubt that this result is significant. In digging into this, we’re attributing it largely to the ESG pressure which has grown massively on HQs from investors especially even in this last 12 months. This is now landing quite seriously in the mine sites but maybe without the resources to make sufficient progress. The inherent aversion of the mining industry to change and requires buy in from all stakeholders and internal politics continues to block progress, and we even see some personal agendas playing a major factor.
Axora Q: Elliot, what did you learn specifically around South African insights?
Elliot: As I said earlier, much of what we saw formally resonated with the anecdotal experience and commentary on the ground in South Africa. I was pleased to see that our respondents from the country were below average on those stating “Lack of market knowledge in new solutions” was a barrier to adoption of new digital and technology solutions (28% vs global average of 36%. Brazil was 70% by way of comparison). I know first hand that many of the ecosystem from Europe, Australia and other leading software development markets have been ramping up their focus on the South African market, in some cases aided of course by Axora. The broad agenda inside South Africa for mining includes a major focus on energy security and stability, driven by coal, combined of course with hard rock mining to power the economy – we see this play out in the interactions we have, including a huge focus on our diesel saving solutions.
Incidentally South African respondents reported a slightly lower %, versus the global average, stating they had seen a significant increase in the % of annual revenue allocated to innovation. Our feeling is the innovation agenda is speeding up very fast in the country and will soon be at least at global averages. If you couple this with our experience of South Africa being the gold standard (excuse another pun) of African mining then it paints a picture where the mineral deposits are rich, the country is progressive, and SA is one of the top mining countries in the world.
Axora Q: Nick, as we went to press, you were just departing for a trip to Australia. What did you learn from your last visit on Australian insights when compared to global ones? Were there any major differences?
Nick: We provided some drill-down data and insights to our friends at InvestMETS who published this recently which is worth reading too, but there were some interesting regional variations. Some were perhaps predictable, and some were more surprising. In the former category, it did not surprise us that the (fairly advanced by most people’s perspectives) Australian mining industry was leading the way, alongside Canada, in adopting AI (53% and 55% respectively) compared to more developing markets like Africa and South America at more like 30-35%. Whilst we are very aware of some incredible local innovators in these regions, the most mature ecosystems for AI Mining Solutions are, in our view, in Australia and North America, together with other leading AI countries. These tend to get more rapidly adopted on 'home turf' before scaling out to other regions.
Rather surprisingly, Australia was actually at the high end of perceived disconnect between HQ and mine site (96%), maybe due to the scale of mining companies operating in the company and responding to our survey. Geography no doubt has a role here also.
Axora Q: To you both, what are you expecting to be the key developments in mining innovation in the next 12 months?
Elliot: I am expecting exciting innovation to be piloted and deployed right across the value chain. AI will no doubt dominate the headlines, but we see huge room for innovation in more physical technology from grinding optimisation, fuel and emission reduction and the ubiquity of a connected mine with advanced IoT feeding into AI platforms.
Nick: I agree with Elliot’s assessment, but I am also excited to see huge developments in safety tech. We’re working on some ground-breaking projects that range from heat stress monitoring with smart watches and advanced AI, all the way to mine site security solutions for personal safety. I am excited by the possibilities in this space, in addition to other areas of the mining operation.
Axora Q: To close this out, please give us 5 words to summarise the future of mining innovation
Elliot: Accelerating yet tentative, ESG, AI
Nick: Decarbonisation,safety, efficiency, AI, throughput