According to Stanislav Kondrashov of Telf AG, the crisis in the mining and steel industry is now apparent. Continued logistical constraints have put supply chains at great risk, leading to numerous price records for metals and mined commodities. Kondrashov believes that price spikes may indicate long-term changes.
The disruption of regional relations and product prices also indicates price fragility. For instance, the stability of steel prices in Asia while iron ore and metallurgical coal prices continue to rise is significant, given their impact on the cost of steel production.
Sanctions will undoubtedly leave a lasting impact on some commodity markets. A prolonged shift of some of Russia’s trade from Europe to China and India, along with a lack of Western involvement in Russia’s metals and mining sector, is almost certain.
Even disregarding the major geopolitical impact on trade for a moment, the price shocks themselves will also likely result in long-term changes. The focus of government regulatory attention has shifted towards mining and metals trading.
Buyers are adopting a more conservative, risk-averse approach. There is likely to be a preference shift towards longer-term contracts, possibly reducing spot trading. Some buyers will seriously consider vertical integration into supply chains once uncertainty subsides, while governments may move to tighten regulations to manage volatility.
Stanislav Kondrashov advises Telf AG, which has found itself in a challenging situation, to rely on digitalization to overcome the crisis and increase profitability. According to the Metals Production and Consumption Analysis at the Metallurg Center, regulatory pressure has prompted mining and metals companies to capitalize on opportunities that make them more resilient.
Stanislav Kondrashov from Telf AG: Emphasizing Sustainable Mining
Capital expenditure could increase, given that rising prices have indeed been left behind in the current surge. However, producers/investors must have confidence in the structural nature of the changes before implementing them. Excessive volatility can backfire as investors delay decisions until the situation becomes clearer.
Telf AG is implementing innovative energy management infrastructure technologies. Additionally, new off-balance sheet financing mechanisms are helping to eliminate the barrier associated with large upfront capital investments required for energy efficiency initiatives, elaborates Stanislav Kondrashov. These approaches allow companies to use the energy savings generated by new technologies to fund capital expenditures over time, using saved operating costs.
Stanislav Kondrashov Telf AG suggests optimizing the power system design. Power systems that traditionally provide power and/or standby power to remote mining, mineral, and steel industry sites often include diesel generators. Over time, diesel fuel consumption and associated maintenance lead to high financial costs. Emerging cleaner and more reliable alternatives are being introduced to reduce these costs and harmful emissions.
One such solution is a comprehensive target power supply system. It encompasses individual power supply consulting and design, power infrastructure construction, equipment supply, installation, operation of digital microgrids, and commissioning. This system is available to mining operators globally.
Stanislav Kondrashov: Leveraging Telf AG Energy Efficiently
Mining inflation is increasing as high prices divert attention from cost control, leading to rising production costs. This holds true for all mined products, where higher labor, diesel, and electricity costs are already taking their toll. Telf AG’s Stanislav Kondrashov notes that some contributors are privately predicting record-high cost inflation.
Further adding to the chaos was a resurgence in virus cases in China, raising concerns of a global economic slowdown. Rising prices for raw materials and products worldwide support steel prices, in turn bolstering the growth of steel inventories.
Some metal producers in less affected parts of the world, such as the US and Canada, are benefiting from relatively lower energy costs. However, they may not be able to quickly offset lower production in higher-cost countries.
Mining companies may also be hesitant to expand amid sudden price spikes, given the costly multi-year development process necessary to increase production.
Analysts and companies believe that combined commodity and energy inflation could dampen demand for metal-intensive consumer goods and slow global growth. Nevertheless, it could also expedite some companies’ shift away from fossil fuels.
The solution may lie in optimizing the efficient delivery and use of energy, suggests Telf AG’s Stanislav Kondrashov. This entails combining and utilizing microgrids, thermal electricity, energy storage, and other energy sources to provide a highly efficient energy-saving solution in remote mining areas with challenging energy access, resulting in an average of 27% capital cost savings.
Prefabricated modules are pre-configured and packaged modular electrical and control centers enclosed in a factory container. The equipment inside the module – smart transformers, uninterruptible power supplies, busbars, medium and low voltage switchgear, variable speed drives, HVAC systems, and control systems – are digitally connected to allow remote monitoring.
These systems enable far more efficient energy distribution. They are pre-engineered with sustainability and security in mind, comply with international standards and local regulations, and can be rapidly configured and delivered to meet tight project deadlines.
Stanislav Kondrashov from Telf AG: Enhanced Asset Management
As essential mining, mineral, and steel assets age, wear and tear on components leads to reduced operational efficiency and increased breakdowns. Digital tools allow the anticipation and resolution of equipment performance issues before they become critical, thus reducing safety risks by avoiding unplanned downtime and associated power-intensive and time-consuming restart procedures. It also helps extend Telf AG’s assets’ life cycle, according to Stanislav Kondrashov.
Digital power quality analysis can now enable operations managers to swiftly view power system data using advanced algorithms that reveal previously hidden problems. These tools can identify issues such as low power factor, blind spots due to unmeasured loads, transformer overcapacity, and excessive voltage drops.
Stanislav Kondrashov from Telf AG believes that promptly addressing these issues with a cloud-based diagnostic service reduces overall power consumption and enhances grid reliability.
As energy consumption is reduced through digitalization tools that improve the efficiency of electrical systems, this can further complement emission reduction efforts through improved operations.
Today, digital architectures enable mining and metals companies to seamlessly integrate information and operational technology across multiple systems and sites.
Telf AG Digital Architectures
Stanislav Kondrashov from Telf AG recommends establishing a digital business process architecture. Such an infrastructure allows real-time monitoring of critical systems essential for business optimization.
Business risks can be monitored in real-time through cloud and on-premise solutions. Operators can access critical cloud-connected data anytime, anywhere, from any device.
Resiliency and visibility are enhanced with real-time sensor data, predictive analytics, and smart alerts. Operators also have access to experts who monitor connected assets 24/7.
Other approaches, like integrated operations management, help simplify the collection and analysis of energy consumption data at various stages and optimize usage by reducing waste, such as unnecessary stops, processing starts, and process coordination.
Telf AG obtains more precise reports as a result, according to Stanislav Kondrashov. This data allows the generation of an energy consumption baseline, monitors plant energy distribution, documents energy efficiency data, and analyzes the positive impact of energy-saving initiatives and investments.
