Explorers are sinking more cash into the ground, but apparently still not as much as back in 2014 and a long way off the peak of over $US21 billion ($29.7 billion) spent in 2012.

According to data gatherer S&P Global Market Intelligence, global nonferrous — metals that don’t contain iron — exploration budgets in 2018 grew 19 per cent to $US10.1 billion.

In 2014, explorers spent closer to $US12 billion.

But at least exploration spend is continuing to go up after sliding again in 2016.

Data from the Australian Bureau of Statistics (ABS) showed exploration spend in Australia dipped 0.3 per cent to $582.8m in the December quarter of 2018 compared to the same quarter of 2017.

It was, however, a slight increase over the $582.1m spent on exploration in the September quarter.

S&P says that for the first time since 2012, more companies indicated they had spending plans in 2018 than the year before, but the total number of exploring companies was still one-third lower than the 2012 peak.

Global exploration budgets, S&P Global Market Intelligence
Source: S&P Global Market Intelligence.

“We expect some volatility to persist in the exploration metrics in 2019 as uncertainty still abounds over the sustainability of economic growth between the US and China,” says Mark Ferguson, associate research director at S&P.

“Nevertheless, we should see a general upward trend as the positive underlying fundamentals for most metals encourage increased activity.”

S&P’s prediction is that global exploration spend will witness its third consecutive year of increase in 2019, albeit at a smaller 5 to 10 per cent growth rate.

Mr Ferguson says this is likely to be because the focus will be on more late-stage exploration, with the industry still “risk averse” to much earlier stage discoveries.

Grassroots exploration spend hit an all-time low in 2018, according to S&P.

But in Australia, the ABS says exploration on areas of new deposits rose 4.5 per cent ($10m) and expenditure on areas of existing deposits fell 3.3 per cent (-$12.1m).

Gold accounted for half of global budgets, with an increase of 18 per cent year over year, according to S&P’s World Exploration Trends 2018 report released at the Prospectors & Developers Association of Canada International Convention being held in Toronto this week.

While gold rose the most in absolute dollar terms, base metals — led by copper and zinc — saw a higher percentage increase.

On the other hand, lithium exploration budgets reached a new high of $US247.1m, while cobalt saw the largest percentage increase of any commodity — more than tripling in 2018.

So which countries are explorers particularly interested in?

S&P says Latin America remained the most popular exploration destination, while Canada had the largest aggregate budget of any country in 2018.

The only region that wasn’t feeling the exploration love last year was Pacific/Southeast Asia, which recorded an 8 per cent decrease.

Majors still spending more

The big boys dominated with an almost $US5 billion exploration spend in 2018.

They still outspent junior budgets for grassroots exploration despite a larger percentage increase year-over-year in junior budgets.

Exploration spend can be a key point for some when it comes to investing in resources stocks.

Stockhead reported in February that a large chunk of ASX-listed explorers and miners are doing the right thing and sinking more cash into their projects.

Data provided by MakCorp shows that 63 per cent of ASX-listed resource companies spend more on their projects, including exploration and development, than on admin and staff.

Of the 692 companies that released reports for the first quarter of the 2019 financial year, 436 spent more on their projects.

The average worked out to about a 30 per cent spend on admin and staff with the rest devoted to advancing projects.