The impact of commodity price risk management on the profits of a company

It is well recognized that for the producing companies hedging the commodity price using financial products like forwards or futures has become an important part of the company's production process. But apart from the direct impacts of hedging on the production and hedging costs the use of financial products affects the financing of the company: hedging the volatile commodity prices leads to a reduction of the risk premium the company has to pay for its debt capital, since hedging contributes to more confidence of the investors in the redemption of the debt. In this paper we therefore analyze this dependency of hedging and financing and derive optimal hedging extents for companies in different market situations based on a long-term model. By hedging the commodity price, companies can realize a surplus in profits. Thereby, the optimal hedging extent for a monopolist is often up to 100%, whereas for companies in a polypolistic market the optimum is always less than 100%. These results are illustrated by examples for a producing company.     

Measurement of market power for the environmentally regulated Korean iron and steel manufacturing industry

For industries in which where market prices of certain inputs are not available, measuring the degree of market power by using the markup over the marginal market cost may be inappropriate. With regard to the Korean iron and steel manufacturing industry, which is subject to environmental regulations, the calculation of the price of abatement capital is hindered by a lack of relevant data. To increase the reliability of market power markups, this paper estimates the restricted cost function in which abatement capital is assumed to be quasi-fixed at an optimal level and the supply relation. The degree of market power for the industry, measured as the ratio of the estimated market power markup to the supply price, was estimated to be 0.54 on average between 1982 and 2001. The results indicate that ignoring environmental regulations can overstate the degree of market power by approximately 12%.     

Economic implications of long distance commuting in the Chilean mining industry

More than 10% of the labor force that works in Antofagasta lives in other regions, commuting on average more than 800 km in a shift system that allows working several days in a row followed by several days off. The mining industry is the main contractor of such workers and the impact of the process spreads through the rest of the Chilean territory.Using an input-output approach, this paper shows that a significant amount of resources generated by the mining industries in the Region of Antofagasta goes to other regions in wages earned by commuters who have decided to work in this region but live in another. The commuting process seems to be driven by centripetal forces that support centralization, thus arguing for regional policies to promote the attractiveness of the peripheral regions.     

Inactivation effect of pressurized carbon dioxide on bacteriophage Qβ and ΦX174 as a novel disinfectant for water treatment

The inactivation effects of pressurized CO2 against bacteriophage Qβ and ΦX174 were investigated under the pressure of 0.3–0.9 MPa, initial concentration of 107–109PFU/mL, and temperature of17.8°C–27.2°C. The optimum conditions were found to be 0.7 MPa and an exposure time of 25 min. Under identical treatment conditions, a greater than 3.3-log reduction in bacteriophage Qβ was achieved by CO2, while a nearly 3.0 log reduction was observed for phage ΦX174. The viricidal effects of N2O(an inactivation gas with similar characteristics to CO2), normal acid(HCl), and CO2 treatment with phosphate buffered saline affirmed the chemical nature of CO2 treatment. The pumping cycle, depressurization rate, and release of intracellular substances caused by CO2 were its viricidal mechanisms. The results indicate that CO2 has the potential for use as a disinfectant without forming disinfection by-products.     

Photocatalytic degradation of C. I. Reactive Red 24 solution with K6SiW11O39SnII

Environmental friendly materials, K₆SiW₁₁O₃₉Sn (SiWSn), was synthesized. SiWSn photocatalytic decomposition of C. I. Reactive Red 24 (RR24) with the UV-lamp (253.7 nm, 20 W), Xenon lamp filtered less than 390 nm light (500 W) and sun light was investigated. The results showed that RR24 solution could be effectively decolorized with the SiWSn photocatalyst. The photocatalytic degradation efficiency of RR24 with SiWSn was affected by the initial concentration of RR2 solution, the amount of SiWSn and the photolysis time. It is demonstrated that the process of photodegradation of RR24 with SiWSn is a pesudo first-order reaction, which can be described by Langmuir-Hinshelwood equation. Hydroxyl radicals and holes are both the main oxidants in the photocatalytic reaction of RR24 with SiWSn.     

How have reforms fuelled the expansion of artisanal mining? Evidence from sub-Saharan Africa

This paper investigates whether and how World Bank mining sector reforms have fuelled the expansion of illegal artisanal mining activity in Sub-Saharan Africa. In doing so, the analysis examines three issues. First, the emerging correlation between reforms and poverty, mainly a result of increased unemployment caused by Structural Adjustment Programmes and concurrent privatisation of state-owned enterprises, is explored. Second, the possibility that reform of large-scale mining has decreased available land for peasant farming as well as legalised small-scale mining activity is discussed. Finally, the notion that the regularisation of informal mining activities has been an exceedingly bureaucratic procedure in Africa, therefore providing individuals with little incentive to operate within the legal domain, is examined. Faced with few employment prospects, a growing number of Africans are pursuing employment in the artisanal mining sector, a worrying prospect given its intimate association with environmental degradation and HIV/AIDS.     

重庆丘陵山区石灰性黄壤呼吸特征及影响因素

采用静态暗箱一二氧化碳红外分析仪法研究了重庆丘陵山区石灰性黄壤土壤呼吸特征及影响因素.结果表明,土壤呼吸速率呈现季节性动态变化特征,冬季较低,夏季较高,与地温的季节动态变化基本一致;土壤呼吸与地温之间呈指数关系,其中与5 cm地温的相关性最好;不同土层、不同处理的Q10值不同,变化范围为1.67～2.69.不同田间管理措施对土壤呼吸速率有明显影响,表现为施肥土壤＞未施肥处理,种植作物土壤＞裸地;化肥使种植作物土壤的年平均呼吸速率增加70.8%,化肥、粪肥共同作用增加129%;与裸地相比,单种作物不施肥不能显著增加土壤CO2排放.裸地春、秋、冬季的土壤呼吸速率与土壤水分呈直线关系,决定系数R2=0.414,P＜0.01.在夏季,种植作物未施肥和施化肥处理两者也呈直线关系,R2分别为0.5361和0.4261(P＜0.05),其他季节两者未表现出明显的规律性.     

New mercantilism: A perspective on how politics is shaping world metal supply

The major countries consuming metals tended historically to be also the major countries producing them. It was in their interest to promote mine development to provide low cost raw materials. Over the past fifty years, the share of global production accounted for by consuming countries has declined and producers and consumers of metals have been slowly moving into separate camps having distinct and differing interests. As a consequence of this, governments of producing countries have become more focused on how to maximise the benefit of metal extraction to their economies rather than on how to supply cheap raw materials; a tendency which has found expression in resource nationalism. Governments of consuming countries have in response become increasingly concerned about the implications of this tendency to their economic development and some countries, most notably China, have adopted robust policies to secure their supplies. Through their actions to influence capital flows within the mining industry and to force metals trade into channels which better serve their national interests (a process characterised here as ‘new mercantilism’), metal producing and metal consuming countries are reshaping global supply.     

Is there a Dutch disease in Botswana?

The Dutch disease is regularly evoked in the resource curse literature and remains a frequent explanation for the poor economic performance found in many resource-rich countries. Given Botswana's high rate of per capita GDP growth, it might seem superfluous at first glance to ask whether or not there is a Dutch disease in Botswana. Yet, Botswana merits study here both as a significant potential exception to any posited inevitability of the Dutch disease and also because the debate on whether or not Botswana has avoided the Dutch disease is far less settled than is indicated by its economic growth record. Botswana currently suffers from many of the symptoms of the Dutch disease but not for the causal reasons posited in the Dutch disease model. Indeed, many of the explanations for the lack of diversification found in Botswana's mineral-dependent economy have nothing to do with either diamond revenues or the Dutch disease. Botswana has done about as well managing its resource wealth as could realistically be expected but it is unlikely to succeed in diversifying its economy away from diamonds anytime soon.     

How to evaluate raw material supply risks—an overview

Some strategic raw materials do have an extremely unsecure supply situation. Several working groups around the world have made criticality assessments for metallic raw materials to analyze the driving impact factors for this instability. However, the influences on raw material availability are manifold and therefore criticality assessment methods are very heterogeneous. Here we give an overview about the differences and similarities of supply risk evaluation in 15 criticality assessment methods. We take the example of Indium, which has been rated in 60% of these criticality studies, and show which data base is used for supply risk evaluation. Our results show a lack of consensus about which indicators give reliable information for raw material supply risk and how these indicators should be aggregated. We anticipate our essay to be a starting point for more justified indicator selection and weighting in criticality assessments.