Non-ferrous metal industry set for major turnaround

A study indicates that times can only get better for the non-ferrous metal industry.

Resource Strategies Inc. (RSI) of Pennsylvania, in association with Metals and Minerals Research Services of the United Kingdom, says the past 5-6 years have seen a marked deterioration in the industry’s fortunes. Its 1994 World Minerals Industry Financial Review surveys 187 separate minerals-producing companies worldwide.

RSI calculates that, between 1988 and 1993, average U.S. dollar base metal prices declined by 44% in nominal terms, gold prices fell 18%, platinum prices dropped 30% and silver prices were off 40%. Simultaneously, base metal consumption rose 8.6% and production was up 6.8%.

The highest operating revenue was achieved in 1989. The 1990 decline, at 0.8%, was modest; it then dropped 3.9% in 1991, 0.3% in 1992 and 11% in 1993. Hit especially hard were silver, nickel and lead-zinc producers. Gold producers (outside of South Africa) formed the only sector to benefit from a rise.

RSI’s analysis suggests that operating costs were also reduced in 1993, but by less than operating revenue. RSI believes total operating costs were cut by 9.8% last year to a level 4% below that of 1989. Operating profits are calculated to have fallen by 26%.

The price of the study is US$1,350. For more information, contact Resource Strategies Inc., 626 West Lincoln Highway, Exton, PA 19341, U.S.A.