It turns out that 1981 might have been a watershed for base metals. Up until then, Canada’s national reserves of the base metals had been on a steady upward path. According to figures compiled and published by Energy, Mines, and Resources Canada (emr), weak prices between 1981 and 1986 caused a 30% decline in reserves of molybdenum, about a 20% decline for lead and zinc, and roughly 15% for copper and nickel. The figures were based on the metals contained in known mineable ore that is well delineated.
More recent statistics reveal that the downward drift hadn’t stopped. From 1985 to 1986, reserves of molybdenum dropped 7%, lead dropped 10%, and copper and zinc 9%. Nickel reserves were largely unchanged during that period.
The mineable supply of gold has soared meanwhile. Between 1981 and 1986, reserves swelled by 70%. Silver reserves fell by 15% over the same period.
In many cases, the drop in reserves came from companies that wrote down or completely wrote off deposits that were judged uneconomic.
The emr study, published as Canadian Mines: Perspective from 1986, says the over- all national trend is affected, for the most part, “by relatively few mines with large changes in reserves.”
It should be noted that estimates for 1987 suggest that reserves for most of the base metals will either hold their own or rise slightly.
Perhaps 1986 will prove to be the turnaround year.
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