Vietnam is abundant with mineral resources of various kinds. Energy minerals, metallic minerals, industrial minerals, and construction materials have contributed to making mining an important industry. However, the reserves of most minerals in Vietnam are not plenty. In addition, many mineral resources have been fully exploited, leading to not much residue in the future.
According to the Ministry of Natural Resources and Environment, Vietnam's mineral resources are pretty diverse and abundant, with over 5,000 mines and ores of about 60 different types of minerals scattered in provinces across the country. Some minerals have important reserves such as bauxite (672.1 million tons), apatite (0.778 million tons), titanium (15.71 million tons), coal (3,520 million tons), rare earth (1.1 million tons), and granite (15 billion m3). Oil reserves are estimated at 6 billion tons and gas at about 4,000 billion m3, distributed mainly in sediments from the South to the North.
In recent years, the mining and mineral processing industry has played an important role in the process of industrialization and modernization of Vietnam. On average, each year the mining industry provides over 100 million tons of cement limestone, over 70 million m3 of common building materials, nearly 100 million m3 of construction sand and leveling sand, over 40 million tons of clean coal, over 3 million tons of iron ore, etc., basically meet the needs of mineral materials for economic sectors.
According to the General Statistics Office, by the end of 2018, the mining industry was worth 408.2 trillion VND, up 9.17% in value compared to 2017, contributing 7.38% in the gross domestic product at current prices. In the first 10 months of 2019, the industrial production index of the mining industry increased by 1.2% over the same period last year.
However, mineral experts assess that Vietnam does not have great potential for minerals due to insufficient reserves for long-term exploitation and difficult mining conditions. According to statistics, Vietnam has oil and gas reserves with a commercial potential of 814.7 million tons of oil equivalent. Meanwhile, as of September 2, 2009, the Vietnam National Oil and Gas Group has reached the milestone of exploiting 300 million tons of oil equivalent, so oil and gas reserves can only be exploited for a few more decades.
Low-grade metaphormic coal in the depths of the Red River Delta is forecasted to have a large resource of several hundred billion tons, but at a depth of thousands of meters underground, mining conditions are extremely difficult and complicated both in terms of technology and ensure social security, environmental safety. A few metallic minerals such as bauxite, rare earth, and ilmenite are abundant in Vietnam, but there are also as many in the world, and the annual demand is not large, so they cannot become a resource for the mining industry. Although industrial minerals and construction materials serve well for the country's economic development and can be exported, they do not have high economic value.
Besides, mining activities at mineral mines of Vietnam have been facing many inadequacies, affecting many socio-economic aspects. Mining is one of the causes of serious environmental impacts, including erosion, landslides, loss of biodiversity, pollution of soil, groundwater, and surface water due to chemicals from processing ore. The massive mining activities and lack of planning are also the direct causes contributing to the depletion of Vietnam's mineral resources.
Mining companies in the world are raking in billions of dollars after the commodity price boom triggered a massive post-pandemic rebound. The global economy rebounded strongly from a deep recession as the COVID-19 pandemic last year fueled a boom in commodity prices. Unable to travel and eat out during the pandemic, consumers instead spend money on physical goods.
The Bloomberg Commodity Spot Index, an index of more than 20 raw materials, hit a 10-year high recently and is on track to record 2011 North Sea crude, the benchmark for the global oil market demand has risen above the threshold of 75 USD/barrel. Copper prices are back to 10,000 USD/ton while European gas prices are at summer highs. Steel prices are also at an all-time high.
The mining industry in Vietnam took a hit from the COVID-19 pandemic. After seven months of 2021, the IIP of the mining industry decreased by 6.3%, of which crude oil and natural extraction fell by 10.4%. Some provinces strong in mining, such as Thai Nguyen, Quang Ninh, Lam Dong, etc., reported negative growth in the first six months of 2021. In general, up to this point in 2021, the mining industry in Vietnam is looking bleak.
Compiled by VietnamCredit