A mineral commodity life-cycle?: Relationships between production,price and economic resources

The production, price and economic resources profiles of a number of mineral commodities are examined and consideration is given to the theory that such profiles can be related to one another within the framework of a life-cycle model of development. While the behaviour of some of the commodities examined appears to lend support to the theory, that of others reveals fundamental problems with its underlying assumptions. It is concluded that, while the demand for a mineral commodity in specific uses may indeed manifest cyclical tendencies, as a general behavioural theory and as a basis for resource estimation the life-cycle model applied to minerals is of little value.     

International commodity transactions : The role of the commodity futures trading commission

The creation of so-called ‘financial’ futures contracts in the USA has spurred the growth of futures trading by other countries, including the UK. The increased expansion of commodity futures trading has also led to heightened regulatory concerns throughout the world. The USA has been especially aggressive in asserting jurisdiction and establishing regulatory controls over persons dealing in the US markets. The complexity of the regulations adopted is compounded by the fact that they are often directed at specific instruments, while similar instruments are not given comparable regulatory treatment. This article discusses the growth of futures trading worldwide, as well as regulatory concerns and requirements existing in the USA.     

Primary commodity prices — a pedagogical note

This note provides a simple statement about the pricing of primary commodities — and in particular oil and non-fuel minerals. It is contended that inventories must enter the analysis in an explicit manner. The place of expectations is also discussed briefly.     

Feasibility,forward pricing and returns: Recent developments in the literature on futures trading

In recent years the feasibility conditions for market establishment and the information value of futures markets have been central issues in futures market research. This paper first discusses recent developments under the heading of feasibility conditions, including the obsolescence of the commodity characteristics approach and the search for a comprehensive framework. Second, futures markets collect and disseminate information, and in so doing they are centres of rational price formation, and the forms of tests that have been developed to ascertain whether they perform this function efficiently are considered. Futures markets also perform a forward pricing function: their prices may be regarded as market anticipations of subsequent cash prices. 1970s' literature has addressed this question, finding differences in performance between continuous and non-continuous inventory commodities. This paper discusses the reasons for and economic implications of these results.     

Forward pricing and efficiency in the silver market

If futures prices ‘fully reflect’ all available information, then these prices may be interpreted as market anticipations of spot (cash) prices at the delivery date of the futures contract. This hypothesis, which has tended to find most support among established markets for storable commodities, is investigated for the Chicago silver futures market. Using instrumental variable estimation and a joint (χ²) test, the unbiased prediction hypothesis is rejected, and a tentative explanation is offered for this outcome. This result, however, does not necessarily imply that the market is inefficient, and two tests of the weak form efficient markets hypothesis suggest that, while there is some slight dependence in past prices, this is only marginally more than would be expected from normal sampling variation.     

The integrated programme for commodities: An assessment of negotiations on minerals and metals

No agreement has yet emerged from the negotiations on mineral commodities held under the Integrated Programme for Commodities (IPC), and there is little, if any, prospect for one in the near future. This article examines the reasons for this standstill and the underlying assumptions on which the IPC is based. The following points are raised: the premise that problems of individual commodities are mutually exclusive and can be dealt with in a single framework of measures is shown to be doubtful; the principle of a commodity-by-commodity approach can no longer remain unchallenged; and structural flaws in the negotiating machinery are manifest. However, results of negotiations have not been entirely negative: the need for two-tier preparatory negotiations has been accepted and a case for a permanent consultative body, perhaps covering several commodities, has been made out. Lack of substantive reciprocity, hence political discord, remains the stumbling-block.     

UK balance of payments in raw materials: A statistical analysis with implications for possible national materials policies

The author discusses the concept of a national materials policy for the UK and focuses on the implications for such a policy to be derived from analysis of the UK balance of payments. The position of materials in the overall trade balance, the role of individual commodities, the form of metal imports and the sources of supplies are all examined statistically to consider what are the major trends in materials trade.     

Economic and Ecological Rules for Water Quality Trading1

Horan, Richard D. and James S. Shortle, 2011. Economic and Ecological Rules for Water Quality Trading. Journal of the American Water Resources Association (JAWRA) 47(1):59‐69. DOI: 10.1111/j.1752‐1688.2010.00463.x Abstract: Emissions trading in textbook form uses markets to achieve pollution targets cost‐efficiently. This result is accomplished in markets that regulators can implement without knowing pollution abatement costs. The theoretical promise of emissions trading, along with real‐world success stories from air emissions trading, has led to initiatives to use trading for water pollution control. Yet, trading, particularly when it involves nonpoint sources of pollution, requires significant departures from the textbook concept. This paper explores how features of water quality problems affect the design of markets for water pollution control relative to textbook emissions markets. Three fundamental design tasks that regulators must address for pollution trading to achieve an environmental goal at low cost are examined: (1) defining the point and nonpoint commodities to be traded, (2) defining rules governing commodity exchange, and (3) setting caps on the commodity supplies so as to achieve an environmental target. We show that the way in which these tasks are optimally addressed for water quality markets differs significantly from the textbook model and its real‐world analogs. We also show that the fundamental appeal of emissions trading is lost in the case of realistic water quality markets, as market designs that reduce the costs of achieving water quality goals may no longer be implementable without the regulatory authority having information on abatement costs.     

Testing the international linkage in the platinum-group metal futures markets

This study tests whether an international market exists in the platinum-group metal (PGM) futures markets. For this purpose, we tested the law of one price (LOP) and the causality between the U.S. and Japanese platinum and palladium futures markets. We also performed the test when structural breaks are considered. Long-run price relationships were found in both platinum and palladium markets but the LOP only sustained in the palladium market. The causality test revealed that it is the U.S. market that leads the price to transmit information between the U.S. and Japanese markets. Structural breaks had large impacts on the test results, suggesting that incorporating breaks is important when investigating the international price linkage in the PGM futures markets.     

Future markets: An alternative for stabilizing secondary materials markets?

The authors present an economic justification for extramarket intervention in the markets for secondary materials and briefly discuss the possible impacts of futures trading on the cash market for a commodity. These impacts are applied to the markets for secondary materials and the potential effects are assessed. They conclude with a rationale for public participation in initiating a scrap futures market.     

中国碳交易市场发展现状及对策分析

中国强制碳交易标的物的确定、排放权的分配、排放源的监测核查等制度设计尚不明晰,也未出台温室气体交易活动的相关管理办法,碳减排体系尚未真正确立。碳市场处于初建期、探索期。通过对碳交易活动的背景、实质、运行机制以及国内碳交易现状的分析,结合应对气候变化的国际进展和国内政策行动对中国碳交易市场发展对策进行了探讨。     

Development of a Commodity-by-industry Economic-Ecological Model of Water Demand in a Rural Economy

The main objective of this paper is to develop a commodity-by-industry economic-ecological model (CIEEM) based on data collected in a rural village in Nigeria and to assess its utility for measuring the implication of various economic activities on the demand for scarce water resources. Our primary concern is model construction and determination of the direct and total requirements of both economic commodities (inter-industry transactions) and ecological commodities (water, land and vegetation) used in the economy. Also considered is the discharge of ecological commodities (waste water and solid wastes) back to the environment. Results show that, despite sparse sectoral interdependence within the economic system, inputs and outputs of ecological commodities include significant indirect components that can only be captured in an input-output framework. The most intensive users of water based on the direct effects are animal husbandry, construction and irrigated agriculture; based on total effects they are catering/trading, construction and animal husbandry, in descending order.     

二氧化碳捕集技术发展动态研究

介绍了近年来新兴的二氧化碳捕集技术路线和国内外的有关研究项目。通过研究由清洁发展机制延伸出来的碳交易及其市场表明，在未来的几十年中，碳交易将成为最大的贸易商品，并且能够减少环境污染和产生较高的利益。     

“One thing leads to another”—Commodities,linkages and industrial development

With a particular focus on low income economies in SSA, this paper addresses the nature and determinants of linkages from the commodities sectors and challenges the received view that enclave development is an inherent characteristic of resource extraction, particularly in the hard and energy commodities sectors. It argues that there has been a steady increase in linkage development and that there are significant opportunities for deepening this process. The opportunities may be greater for backward than for forward linkages, particularly in the minerals and energy sectors. In making this case, this Discussion Paper draws on the experience of high income countries which have resource intensive economic structures, the geographical specificity of many resources and the growing interest of large resource extracting firms in outsourcing the production of inputs which are outside of their core competences and in supporting local production of some inputs, it sets out a general model of linkage development which distinguishes between win–win and win–lose outcomes.     

Oil spills on other commodities

This paper examines the effect of crude oil prices on the prices of 35 internationally traded primary commodities for the 1960–2005 period. It finds that the pass-through of crude oil price changes to the overall non-energy commodity index is 0.16. At a more disaggregated level, the fertilizer index had the highest pass-through (0.33), followed by agriculture (0.17), and metals (0.11). The prices of precious metals also exhibited a strong response to crude oil price. In terms of individual commodities, the estimates of the food group exhibited remarkable similarity while those of raw materials and metals gave a mixed picture. The implication is that if crude oil prices remain high for some time, as most analysts expect, then the recent commodity price boom is likely to last much longer than earlier booms, at least for food commodities. The other commodities, however, are likely to follow diverging paths. On the methodological side, the results show that price indices, while providing useful summary statistics, they need to be supplemented by individual commodity analysis.     

The role of the Australian minerals industry in world mineral supplies

Australia is one of the world's main producers and exporters of both fuel and non-fuel minerals. Among the main commodities produced for export are bauxite/alumina, iron ore, and nickel—Australia is also an increasingly important source of supply of black coal, especially for Japan, and is a significant producer and exporter of a number of base metals. Resources are adequate to support a substantial expansion of both non-oil fuels and other minerals. The potential for growth, both in terms of specific commodities and in the overall role of Australia in the world mineral industry, will depend to a very large extent on the cost competitiveness of Australian mining and on continuing inflow of capital.     

The political economy of certificates for land use in Germany – experimental evidence

Certificate trading schemes have been discussed as a cost-efficient means of reducing urban land consumption in Germany by capping and reallocating permissions to conduct building projects. However, in contrast to the established cap & trade systems for emissions, reputation-seeking politicians would be in charge of buying and trading certificates – an aspect not considered to date. We thus present a laboratory experiment that captures politicians’ incentives connected to electoral cycles in a cap & trade scheme for land consumption, whereby tradable certificates are auctioned and grandfathered in equal shares. We find the cap & trade system to be efficient at large; yet, there are several politically relevant distortions that are aggravated by self-serving incentives. We thus identify potential problems to a cap & trade system for urban land consumption that could substantially reduce both its assumed superior efficiency and its political feasibility.     

US nonfuels minerals policy

Nonfuels minerals policy in the USA flows from the differential and unique reactions of these industries to general economic policies in the areas of taxation, land use, environment, and international trade. To search for nonfuels minerals policy as direct statements by the US government on nonfuels minerals is futile. Nevertheless, the industries are unique in many characteristics, and the application of these general policies to the minerals industries creates unique situations. This uniqueness has been recognized by a virtually constant policy review over the past 10 years. The current effort is just beginning, and to prejudge now the outcome of this discussion is premature. However, it is not premature to argue that because of the uniqueness of these industries, it may be expected that their problems will be receiving public attention for many years to come.     

电力行业实行二氧化硫排污交易浅析

本文介绍了排污权交易在国内外的发展进程及现状。分析了我国电力行业实行二氧化硫排污交易的可行性，同时指出该交易体系目前存在的初始排污权分配、环境公平性、交易市场以及政府职能等问题；建议我国应在借鉴国外成功经验的基础上，结合我国实际情况逐步建立二氧化硫排污权交易的完整的市场体制，并完善相关政策，扩大交易范围。     

Global competition for strategic mineral supplies

The USA's dependence on imported sources of strategic minerals has grown substantially since the second world war, while its ability to protect the sealanes critical to foreign supplies has deteriorated. Domestic production has been severely hampered by a lack of access to mining on public lands, and by excessive environmental regulations. No major purchases have been made for the strategic stockpile in 20 years. Concern has been growing in Western Europe and in Japan about secure supplies of strategic minerals. Being even more dependent on foreign sources of supply than the USA, some of these countries have recently initiated their own strategic stockpilling programmes. The USSR, long an important exporter of metals, appears to have changed its mineral trade policy, and has sharply reduced exports while entering the market as an importer of a number of key metals. These developments foreshadow growing competition for world supplies of strategic minerals.