Boston Consulting on mining's next supply wave

With demand for commodities rising, prices back above long-term averages and debt levels diminishing, miners' thoughts will sooner or later turn to whether and how to develop new supply. But underlying returns on capital in the mining sector have been poor for decades, and the investment mantra that dominated during the last super-cycle - bigger is better - has turned out to be flawed.

Neal Brewster and Martin Feth*

Investing in profitable growth in the future will prove even more challenging, with miners having to develop projects in more remote areas, mine lower-grade or more difficult orebodies, and face stricter environmental regulations and increased commodity-price volatility.