The market value of the mining industry's listed companies has...

The market value of the mining industry's listed companies has fallen below US$1,000 billion for the first time since April 2009. In its recently published Industry Monitor, SNL Metals & Mining notes that the aggregate market capitalization of 2,684 listed companies tracked in the SNL database at the end of September was only US$934 billion, compared with US$1,030 billion at the end of August. This represents a 9.3% month-on-month decline (there was the same number of listed companies).

The industry's valuation on the world's stock exchanges has fallen over 43% since the middle of last year, and is now only 39% of the US$2,415 billion valuation achieved in April 2011. On this basis, the industry is worth considerably less than Apple Inc. (US$650 billion) and Google (Alphabet Inc.; US$440 billion). The low point remains November 2008, when the market capitalization of the then 2,390 listed companies was US$656 billion.

The value of the 100 largest listed mining companies is now under US$800 billion, having fallen below the US$1,000 billion mark at the end of July for the first time since June 2009. These companies’ share of the industry's aggregate valuation was 85.6% at the end of last month, compared with a low of 84.3% in February 2011 and a high of 93.8% in November 2008.

As the graph below illustrates, in periods of greatest turmoil the largest 100 mining companies tend to hold their value better than the remainder of the industry, and so account for a greater percentage of the total valuation. This elite group’s share of the total market capitalization has stabilized at 86-87% for most of the past three years.

Notwithstanding the continued decline in the value of the industry's listed companies, SNL's Pipeline Activity Index, which measures exploration and development activity, increased in September after a healthy increase in drilling activity and a slight uptick in announcements of initial resources.

This encouraging picture was offset by a 50% drop in the number of financings by companies with annual revenue of less than US$500 million. There were only 12 such financings of over US$2 million last month, compared with 24 in August and 36 in June. This represented the lowest number of financings by exploration companies since at least January 2012. However, the US$171 million raised in September (70% by Canadian companies) was 15% higher than the month before, although still only a third of the US$513 million raised in June.