• Industry: Industrial Manufacturing, Mining
  • Type: Survey report
  • Date: 7/8/2013

Global Metals Outlook 

This report examines the current trends and emerging business opportunities for the metals sector. Restructuring and cost cutting will likely continue in the slow growth markets of Europe; investment should continue to pick up in the high growth markets in Asia, Latin America and Africa; and consolidation will inevitably continue, particularly in China where significant room still remains for the industry to modernize.
Global Metals Outlook
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Key findings:

Low growth expectations drive cost reduction

With lower-than-average expectations for global economic growth, more than 60 percent of metals respondents say they expect to further reduce their cost structure. But all indications suggest that today's consolidation and cost-reduction exercises will lead to a stronger and more resilient sector in the future.

Focus on enhancing supply chain visibility

A lack of visibility into the supply chain is impacting the sector's ability to respond to, and recover from, sudden supply chain disruptions. More than half of all metals respondents admitted to having either no visibility or limited Tier 1 supplier visibility, while two thirds said it would take them more than a week to assess the impact of a disruption.

Shifting markets create new opportunities

The continued slowdown in mature markets has led metals organizations to seek out new opportunities for growth:

  • In emerging markets  where a third of respondents said they expected sales growth to come from China; and
  • Through the development of more sophisticated products, as 39 percent said they would increase R&D investments to more than 4 percent of revenues.

2013 will likely be remembered as a year of foundational change for the metals sector.

As this Global Metals Outlook clearly demonstrates, metals companies are keenly exploring new opportunities for cost cutting. In some markets – particularly those where overcapacity is perceived to be more structural in nature – there will likely be a further restructuring of assets. At the same time, continued restrictions on available capital and a temporary drop in resource prices around the world has also catalyzed metals organizations to focus their attention on the optimization of their existing assets rather than the acquisition of new ones.

Eric Damotte
KPMG's Global Head of Metals


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