Where next for UK mining stocks?

The mining sector is often associated with ill-disciplined capital management. Through the last supercycle, driven by Chinese industrialisation, bullish management teams typically signed off overzealous projects and ill-advised M&A activity as they sought to grow volumes, often to the detriment of returns on capital and shareholders' returns.

After an excruciating downturn, lasting until early 2016, and mounting shareholder pressure, it seems many UK miners have turned over a new leaf. New management teams appear to have taken heed of past mistakes with debt reduction, careful capital allocation and returning cash to shareholders now very much at the top of their agendas.  Rio Tinto, Glencore, Anglo American and BHP have returned to cash generation by heavily reducing capital expenditure. This focus on value over volumes has also helped rebalance supply with demand in commodity markets.  One of the main internal drivers of...