Short-run price formation in non-fuel minerals markets: An algebraic note

Simple flow models are inadequate for understanding short-run price behaviour in non-fuel mineral markets. In this note the author derives a simple model of mineral price behaviour in terms of stocks, and shows how this may successfully explain some short-term features of mineral price behaviour.     

Economic rent : Incidence in selected metals and minerals

The magnitude of the ‘economic rent’ and its distribution among producing countries, mineral exploitation companies and consumers has become a dominant issue in national and international policy formulation, but the difficulties in measuring the rent add to the problems of determining its equitable distribution. This paper examines the nature of the rent and estimates its incidence in bauxite, copper, iron ore, phosphate rock, tin and petroleum. Rents were found to be low for bauxite and iron ore. Bauxite, phosphates and petroleum producers have increased their share of the rent, though this trend now seems to be reversing for bauxite and phosphates. Only in tin, and to a lesser extent petroleum, have the exporting countries captured significant shares in total rent. Otherwise, the rent is largely concentrated at the processing stage, which suggests that processing plant would have to shift to the producing countries if they are to claim a larger share.     

Structural and technological changes of greenhouse gas emissions during the transition period in Polish industry

We analyzed the patterns of energy use and greenhouse gas (GHG) emissions in Polish industry arising during the transition from a centrally planned economy to a market economy. A method of analyzing industry energy use and GHG emissions is discussed. Using this method, the impact of changes in industrial production value, the share of specific industry branches in the total industrial production, energy intensity, and the mix of the energy carriers in the 1989–1993 period has been analyzed. The last year of the analyzed period shows favorable trends in efficiency and signs of production structure shift to a less energy-intensive one. Economic reform implemented after 1989, which released energy carriers' prices from government control, had important effects on the industrial sector. Energy efficiency and emission intensity trends of 1992–1994 were favorable; if they continue, production will return to 1989 levels with much lower energy consumption and significantly decreased GHG emissions.

     

Innovation in the minerals industry: Australia in a global context

The pattern of innovation in the global minerals industry is changing as the industry becomes increasingly globalised. In this paper, we look at the structure of innovation in the industry and the drivers of change. We first consider the broad international trends and then examine these more closely with special reference to the Australian industry. Issues addressed include the apparent decline in corporate research and development spending, changing patterns in research collaboration and outsourcing, and the uptake of information and communication technologies in the industry. We also look at the potential implications of these trends for step-change technological developments and at the role of technological innovation in the future development of the industry.     

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.     

R&D prospects in the mining and metals industry

The mining and metals industry is considered more-or-less technology mature as it spends less than 1% of its revenues on R&D. In the period 2003-2008, that sector saw a very significant increase in profitability. Yet, during the same period, mining and metals companies continued to trim R&D spending, a trend that started in the early 1980s. In the near future the mining and metals industry will face significant challenges including an increased demand from the developing world counterbalanced by an overall trend to lower ore grades and with high pressure to reduce energy consumption and carbon dioxide emissions. To overcome these challenges, the mining and metals industry will likely face the need to considerably increase its R&D efforts. As the world enters a period of economic uncertainty, the sector will need to revise its approach towards R&D, reconsider its position against collaborative research with academia and other institutions, and be more creative when it comes to R&D funding.     

Assessment of risk in a minerals industry: Canadian nickel

The level of rents attributable to natural resource producers depends on the risk faced by those producers. This paper argues that estimates of risk in mining should control for characteristics of firms such as diversification and debt financing. The capital asset pricing model is applied to securities of three Canadian nickel mining firms over the period 1961–1974. It is concluded that the level of risk was not unusually high.     

An empirical approach to determine specific weights of driving factors for the price of commodities—A contribution to the measurement of the economic scarcity of minerals and metals

In recent years, commodity markets show a large amount of volatility and substantial price jumps, indicating an increasing economic scarcity in many cases. As this scarcity makes commodity procurement a critical issue for national economies, industry sectors and manufacturing companies, a number of criticality indices have been presented and utilized in science as well as in practice. These indices are mostly based on an aggregation of different key figures, both qualitative and quantitative. However, the weighting of the different factors is in most cases arbitrary or based on rough estimates.     

Advances in materials science and changes in the metal industry

High temperature superconductivity is representative of the advances being made in the science of materials. Both the theoretical and practical understanding of materials is making great progress. The advances are changing the world in which metals producers operate. One of the major changes is that the material-use decision is becoming more complex. The new materials have an advantage against the older materials in that they dominate the general discussions, relegating metals to a 'has-been' role. Unless the metals industries become more adept at maintaining the knowledge that metals are adaptable and suitable for most uses, metals will suffer greater than necessary losses in market share to new materials.     

Structural and sorption characteristics of adsorbed humic acid on clay minerals

Clay-humic complexes are commonly distributed in natural environments. They play very important roles in regulating the transport and retention of hydrophobic organic contaminants in soils and sediments. This study examined the structural changes of humic acid (HA) after adsorption by clay minerals and determined phenanthrene sorption by clay-humic complexes. Solid- and liquid-state 13C nuclear magnetic resonance (NMR), for the first time, provided direct evidence for HA fractionation during adsorption on mineral surfaces, that is, aliphatic fractions were preferentially adsorbed by clay minerals while aromatic fractions were left in the solution. The ratio of UV absorbance of HA at 465 and 665 nm (E4 to E6 ratio), which is related to aromaticity, corroborated with the NMR results. For both montmorillonite and kaolinite, adsorbed HA fractions had higher sorption linearity (N) and affinity (K(oc)) than the source HA. The K(oc) of adsorbed HA for the clay-humic complexes could be up to several times higher than that of the source HA. This large increase may be contributed by the low polarity of the bound HA. Moreover, for each mineral, the N values of adsorbed HA increased with increasing HA loading. It is believed that HA may develop a more condensed structure on mineral surface at lower HA loading level due to the stronger interactions between HA and mineral surface as a result of close contacts.     

Broadening the statistical search for metal price super cycles to steel and related metals

During the past five years, industry analysts have proclaimed that metal prices are in the early phase of a ‘super cycle,’ driven primarily by Chinese industrial expansion. Academic economists have generally been very skeptical about the presence of long cycles. A time-series econometric analysis by Cuddington and Jerrett [2008. Super cycles in real metals prices? IMF Staff Pap. 55(4), in press], however, has used band-pass filtering techniques to isolate super cycles in the prices of six metals traded on the London Metal Exchange (the ‘LME6’). This paper extends the search for super-cycle behavior to three additional metal products that are critical in the early phases of industrial development and urbanization: steel, pig iron, and molybdenum (a key ingredient in many steel alloys). There is strong evidence of super cycles in these three metals, although their timing differs to some extent from the super cycles found for the LME6.     

Social dimensions of mining: Research,policy and practice challenges for the minerals industry in Australia

The social dimensions of the mining industry are increasingly acknowledged as critical to business success, yet remain the least understood aspect of the business concept of sustainable development—the ‘triple bottom line’ of economy, environment and society.     

Economic liberalisation, innovation, and technology transfer: opportunities for cleaner production in the minerals industry

The liberalisation of investment regimes for mining over the past decade is encouraging an inflow of foreign investment for mining and mineral processing projects in developing and former centrally-planned economies. This new investment is occurring at a time of technological change within the international mining industry as market and regulatory pressures lead the most dynamic firms to invest in the development or acquisition of new technologies and management practices. The effective transfer and assimilation of these technologies enable mining companies to combine gains in productivity with improvements in environmental management. Joint ventures and other strategic alliances between inwardly investing firms and the newly privatised or remnant state-owned mining enterprises may provide an effective vehicle for the transfer of the techniques for more productive and cleaner operations. Specific examples of innovative process and remediation technologies are analysed and it is suggested that the ability of innovative technologies to improve competitiveness and sustain best-practice environmental management in the recipient is linked to the transfer and effective acquisition of the capacity to manage the complex processes of technological and organisational change. The paper closes with some recommendations for further research directed towards a systematic examination of this hypothesis.     

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.     

The USSR, China, India and the world metals industry to 2010

Remarkable changes are occurring within the economies of the USSR, China and India that are influencing mineral industry activities. These three countries account for a major share of world minerals production and consumption. Their domestic reforms may ultimately have a serious impact on the global mining industry. This paper examines the present status of the Soviet, Chinese and Indian mineral industries, and forecasts conditions to 2010. Long-term characteristics analysed include industrial production, intensity of use, consumption, mine and plant expansion and trade policy. Six metals are highlighted in the study – aluminium, copper, lead, nickel, steel and zinc.     

Jordan,minerals extraction and the resource curse

In its role as a competitive producer of phosphate and potash Jordan has not suffered noticeably from the Resource Curse over the past 50 years. However, the effects on its economy because of its geographical proximity to major oil-producing states have been both positive and negative. It is arguable that an oil resource curse has applied to Jordan.     

The significance of futures trading in minerals and oil

Futures trading has been introduced for aluminium and oil in recent years and the range of contracts available on various minerals and oil products continues to widen. Concern has been expressed by producers of a number of minerals, including nickel and platinum, that the introduction of futures trading may introduce a speculative element to price determination that will create inappropriate or excessively volatile prices. It is the purpose of this article to analyse the role of futures trading in relation to trade in underlying commodities in general and especially for trade in minerals and oil. Evidence from oil and platinum markets, in particular, is adduced and examined in the light of earlier evidence of the influence of futures trading on underlying commodities. The contribution of futures trading is examined in detail and conclusions are reached on the significance of futures trading for minerals and oil.     

Understanding the dynamics and competitiveness of the South African minerals inputs cluster

South Africa has developed niche competencies around the extraction and processing of mineral resources. Firms involved in the manufacture and supply of inputs to mining and mineral processing represent a key source of competitive advantage upon which future growth and development in the country can be planned. Drawing on a qualitative and quantitative study of 678 supplier firms conducted in 2004, this paper presents an assessment of the state of the South African minerals inputs cluster. The various demand and supply relationships, dynamics, and growth opportunities within the cluster are highlighted and the threats affecting the cluster's future competitiveness reviewed. The interventions needed to overcome and/or enhance them are also identified.     

Trace element retention and release on minerals and soil in a constructed wetland

Constructed wetlands are one method under investigation for the remediation of trace element-contaminated agricultural drainwater. A greater understanding of the retention of trace elements by the bulk soil and soil constituents is necessary for their safe and effective use. To determine the capacity of soil, calcite, and goethite-coated quartz sand for retention of As, Mo, and V under field conditions, an in situ method was used whereby permeable bags containing those minerals were placed near the sediment surface of a flow-through constructed wetland for 3 or 12 mo. Accumulations of As, Mo, and V occurred on goethite-coated sand. Concentrations of Mo on goethite-coated sand were much higher in samples from a wetland cell with a water depth of 15 cm (38.23 +/- 7.27 mg kg(-1)) compared with those from a cell with a water depth of 3 cm (8.30 +/- 1.45 mg kg(-1)). Calcite sorbed no As and low amounts of Mo and V, indicating that it is not an important sink for those elements under these conditions. In soil bags, total As and V concentrations showed little change over 12 mo. Molybdenum accumulated in the soil bags, resulting in total concentrations (12 mo) of 27.22 +/- 2.69 mg kg(-1) and 11.42 +/- 1.35 mg kg(-1) at water depths of 15 and 3 cm, respectively. Nearly half of the Mo accumulation on soil became water soluble after air-drying. This has important implications for systems that may undergo changes in redox status, possibly resulting in large fluxes of water-soluble Mo.