Mining companies tap alternative credit sources as lockdowns, low prices hit cashflow

Mining companies are looking to trading houses and specialist funds for credit since lower metal prices and enforced shutdowns have restricted cashflow.

Peru, Mexico, Bolivia, Ecuador, the Democratic Republic of Congo and South Africa are among major mining nations to order mine closures as part of countrywide lockdowns designed to protect against the spread of the Covid-19 disease.
Cashflow-limiting closures come at a time when banks have become cautious about lending, leaving miners seeking alternative sources of funds to maintain operations, sources told Fastmarkets.
"Without a doubt our team is busier than they've ever been, we’ve got multiple term sheets out and a lot of that is inbound," Michael Scherb, the founder and chief executive officer of mining private equity fund manager Appian Capital Advisory, said.

Trading companies are also fielding a flurry of...

Published

Archie Hunter

May 07, 2020

14:25 GMT

London