HEAVY ENGINEERING
Forging ahead
Australian grinding media
major Donhad has finally
joined Moly-Cop
Major acquisitions, foundry investments and new
technology, the companies that supply castings, grinding
media, gears and other crucial metallic products for
mining are not standing still, reports Paul Moore
ast month, we reported on the biggest
news for some years in M&A activity
among the big players in castings and
wear parts. ESCO Corporation, the Portland-
based global leader in ground engaging tools
for mining and construction entered into an
agreement to be acquired by The Weir Group for
an enterprise value of $1.285 billion. The
combined businesses will provide a unique
offering to global mining customers with a
range of premium, market-leading brands
focused on increasing customer productivity
and reducing total cost of ownership. “ESCO’s
leadership in ground engaging tools
complements Weir’s portfolio of leading
products and services that are used on mine
sites to process materials extracted by ESCO’s
equipment.”
“The foundation of our business for more
than 100 years has been delivering value-added
solutions to customers through a proud
tradition of quality and customer-driven
innovation,” said ESCO Chairman and CEO, Cal
Collins. “This merger is exciting for ESCO. It
combines two premium brands and positions us
to better serve customers around the world. The
merger of ESCO into Weir is a great fit, both
culturally and strategically."
In forged grinding media news, in August
2017, American Industrial Partners, the equity
firm which owns global grinding media giant
Moly-Cop, announced a definitive agreement by
Valmont to sell its Australian mining
consumables business Donhad to Moly-Cop. But
this has only just gone through after The
Australian Competition and Consumer
Commission (ACCC) cleared the deal. Donhad
L
owner Valmont said in its Q1 2018 results
announced April 18 that it expected closing of
the deal by April 30, and this duly went ahead
on this date.
On March 29, the ACCC announced that it
would not oppose Moly-Cop’s proposed
acquisition of Donhad. “Moly-Cop and Donhad
are the only two domestic manufacturers of
forged steel grinding media, which are primarily
used by the mining industry to crush or grind
mineral ore to extract copper, gold and iron.
After an extensive inquiry, the ACCC determined
Moly-Cop would continue to face competition
from suppliers of imported grinding media
following the proposed acquisition.”
“On balance, the proposed acquisition is
unlikely to substantially lessen competition in
the supply of grinding media in Australia,” ACCC
Chairman Rod Sims said. “Imports of grinding
media have increased significantly in recent
years and now represent approximately 40% of
the total quantity of steel grinding media sold in
Australia,” Sims said.
“Australia’s demand for grinding media is
only about 5% of global usage. Spare
production capacity worldwide is many times
greater than what our industry uses in a year.
There are several overseas manufacturers which
could increase their supply into Australia and
compete locally,” Sims said.
The ACCC consulted with a broad range of
customers to understand their options for
grinding media and the reasons for the recent
increase in imports. “Many customers were
concerned about the impact of the proposed
acquisition on competition, which made this a
difficult decision for the ACCC. However, there
was not always a willingness to provide detailed
evidence to back up those concerns, and some
of these customers already use imports.”
“Based on all the information received,
including feedback from customers, internal
company documents and data on import quality
and transport costs, we concluded that the
threat of customers switching to imported
grinding media would prevent Moly-Cop from
increasing prices or decreasing service levels in
a sustainable and meaningful way. Although
there were tariffs imposed by the Anti-Dumping
Commission on certain steel grinding balls
exported from China in 2016, imports have
continued to increase. We considered that some
of the larger global miners in particular would
be able to facilitate further expansion of imports
if Moly-Cop were to attempt to increase prices.”
Grinding media
Last year, Anna Petrova, Moly-Cop’s Director of
Business Development for Russia/CIS provided
a review of the company’s progress in that
region. “Moly-Cop is the global leader in
grinding media and provides a unique capability
and service offering to our customers in Russia.
Customers have been very receptive to Moly-
Cop’s focus on grinding media with exceptional
long life wear properties, supported by a strong
technical support capability focused on
improving customer productivity. Moly-Cop’s
range of grinding media products are designed
and manufactured to decrease specific grinding
media consumption which results in lower cost
per tonne of ore milled. Recent trials in Russia
have indicated significant reductions in
consumption over local supply options in the
range of 30-40% using MolyCop’s standard
range of grinding media. Lower consumption
rates in grinding media results in additional
benefits to the customer including lower
inventory holdings, reduction in the number of
ball charges and less transport movements.
These benefits are of particular importance for
customers often located in remote regions of
Russia which results in long supply chains for
mining consumables.”
Another unique capability Moly-Cop says it
brings is its technical support, with a focus not
just on product performance, but also on the
productivity of our customer’s milling circuit.
“Our technical support extends to services to
improve grinding efficiency, determining optimal
ball sizes and charge levels for the grinding
task. To assist in their analysis, Moly-Cop’s
technical personnel use their proprietary
simulation software called ‘Moly-Cop Tools.’
Moly-Cop also provides training for
customers in the use of these tools, which has
generated huge interest from Process Engineers
in my region. These tools enable customers to
JUNE 2018 | International Mining 47