After three years of booming investment in mining exploration, the industry is set to cut down significantly on that item this year as depressed metal prices and major financial struggles continue to shake the sector globally.

That was one of the key conclusion of a report released Sunday by SNL Metals Economic Group produced every year for the Prospectors and Developers Association of Canada (PDAC), being held in Toronto this week.

Worldwide Exploration Trends 2013 says the unrelenting global economic growth uncertainty is starting to openly affect the spending flow, especially in miners with early stage exploration projects.

With prices declining, such as for copper and iron ore, and costs rising, such as for labour and energy supply, many companies are cash poor. Some analysts are predicting an increase in mergers and acquisitions as companies who do have cash swallow smaller companies.

The SNL MEG report, which focuses on non-ferrous exploration, notes that juniors with really exceptional projects will be able to stay afloat and finance sizable exploration programs. However, those owning smaller or earlier-stage assets will struggle to attract investment and likely end up being acquired by bigger players.

Exploration allocations for all regions increased to record highs in 2012, according to the report. In dollar terms, Africa and Latin America registered the largest increases, the latter being the most popular exploration destination again in 2012.

The region attracted 25% of global spending last year while worldwide spending reached an all-time high of $20.5 billion.

Including estimates for budgets impossible to obtain, the group estimates spending jumped to $21.5 billion in the year, up from about $18.2 billion a year ago. The SNL MEG report is based on information gathered from about 3,500 mining and exploration companies worldwide.