The downturn and subdued prices have weakened the credit conditions of the mining companies, the ratings agency said in a statement.

"Moody's believes that this downturn will mark an unprecedented shift for the mining industry. Whereas previous downturns have been cyclical, the effect of slowing growth in China indicates a fundamental change that will heighten credit risk for mining companies," it added.

This review reflects the belief that deteriorating industry fundamentals require a recalibration of the global mining portfolio rated by Moody's.

China's outsized influence on the commodities market, coupled with the need for significant recalibration of supply to bring the industry back into balance indicates that this is not a normal cyclical downturn, but a fundamental shift that will place an unprecedented level of stress on mining companies, he added.

As part of an ongoing assessment of mining companies, Moody's sharply reduced its price sensitivity assumptions on December 8, 2015. Since then, credit conditions in the mining industry have weakened further, with prices continuing to decline.

Latest News  from Business News Desk