Andrew Bell

Anchor, Reporter

Follow|Archive

The world’s favourite mining show, the PDAC convention, rolls into Toronto this weekend for its 84th year.

The Prospectors & Developers Association of Canada says this is the shindig you must attend to be on the map in mining, even as companies slash costs to survive a five-year slide in the sector since 2011.

"A miner who does not go to PDAC is deemed to have given up the will to live," financier Christopher Ecclestone told us on Commodities in December.

But copper prices have been halved since 2011 and base metal mining shares have dropped a jarring 76 percent on the Toronto Stock Exchange, making it tougher to justify spending heavily on the annual meet-and-greet. And then there’s fallout from the oil slump: Governments like to woo investors at the show but cash-strapped Newfoundland has “had to make the difficult decision to not host a reception this year due to province's fiscal situation.”

Some miners are keeping up their participation. “We haven’t changed our presence or booth,” according to Derek Teevan, vice-president at Toronto-based Detour Gold (DGC.TO)

But for companies based outside the city, the cost can loom larger. “Booth is same size as last year, but I know our hotel room block is smaller,” Christine Marks, spokeswoman for Vancouver-based Goldcorp said in an email.

PDAC says the show “has recently attracted between 23,000 and 30,000 attendees,” dwarfing the 7,000 who showed up at the Indaba gathering in Cape Town last year; 2,100 at IMARC in Melbourne, Australia; 2,500 at Mines and Money London; and 8,000 at the China Mining Congress.

But even PDAC’s crowds have been shrinking lately.

Last year, the convention attracted 23,578, down from more than 25,000 in 2014. And that was sharply lower than the totals of more than 30,000 in 2013 and 2012.

One deterrent for retail investors has been an ongoing slow death for junior miners. As of this week, the index of major gold miners on the TSX was up more than 40 percent in 2016, driven by gold’s move above US$1,240 per ounce; but the battered S&P/TSX Venture Composite Index of smaller firms had gained just 5 percent.

‘The money hasn’t trickled down to the juniors,” says Abitibi Royalties (RZZ.V) CEO Ian Ball, who will be stalking the halls seeking out deals to buy royalties on early stage mining properties.

But miners have legendary staying power and the bars, restaurants and hotel suites of Toronto are set for their yearly influx of hard-partying diggers. PDAC reckons it brings $60-million Canadian dollars annually into the local economy.

When not sharing a small dry sherry, the attendees can visit about 725 exhibitors in a trade show featuring suppliers to the sector and more than 600 companies in the “Investors Exchange”, where miners work to convince investors that their rocks are very, very special (the process tends to be lubricated by bottles of scotch that materialize in the afternoons).

This year’s attractions include “visually stunning” minerals from the Royal Ontario Museum’s Kirwin Collection; new anti-counterfeiting technology from the Royal Canadian Mint; and rough, cut and polished Canadian diamonds from De Beers Canada.

We’ll be interviewing a parade of mining CEOs on BNN. On Monday, we’re all about precious metals. Guests include Randy Smallwood, CEO of streaming giant Silver Wheaton (SLW.TO) and David Garofalo, the newly-minted CEO of Goldcorp (G.TO), which is working to win back investors after cutting its production forecast over the next three years.

On Tuesday, our focus is base metals. We’ll hear from Don Lindsay, CEO of Teck Resources (TCKb.TO), which saw its credit rating cut to junk last year by Moody’s Investors Service. The debt watcher pointed to weak commodity prices and spending on Teck’s oil sands joint venture.

We’ll also talk to Alan Hair, who just replaced Garofalo as CEO of HudBay Minerals (HBM.TO), which has a debt load north of $1-billion. Dundee rates the stock neutral, warning that the “liquidity position is tight.”

So come over and say hello when you see us at PDAC. Maybe we can go for a tiny glass of sherry.