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    COMMODITY MARKETS

    Industrial Metal

    COMMODITY MARKET INDUSTRIAL METALS

    The Industrial Metals Complex
    Copper
    Industrial Metals

    The Industrial Metals Complex

    The demand aspect of commodities is but half of the entire picture as low investments in newly opened mines in the eighties and nineties were considered as the major cause which started this commodity bull market. Low cost paired with high value metals have become less common as the most reputable mining firms are diminished in their readily available products. During the entire the mid 2000's mining firms were extensively into metal exploration for the purpose of becoming trendsetters in findings new sources to satisfy demand. The resulting problem was the amount of time used up to propel these projects on stream, together with the credit burden and the prevailing debt crisis. Seeking capital for high risk investments as these became quite difficult and with prevailing worldwide financial vulnerability companies hesitated to invest in these projects as they were in the pre credit crunch environment. The constricting of fresh sources of product is considered by many as primary reason in inducing the next wave to the strong industrial metal bull market, however, unless funding these projects soon becomes less difficult to achieve and demand begins to decrease, we can expect industrial metals to continue making big profits.

    The industrial metals which are traded on the London Metal Exchange (LME) include copper, aluminium, nickel, lead, tin and zinc. Copper is the lone industrial metal traded on the COMEX and takes the majority of the share of most industrial metal funds and, therefore, is considered the leading industrial metal.

    Copper

    Copper is the prime industrial metal and is utilised in the construction of infrastructure and civil works. It is widely used in the generation and distribution of electricity, plumbing and various piping together with commercial building construction. BRIC countries where mass migration is taking place, for instance, in China, the need for large amounts of copper to support the growth of cities helps to provide dwelling and energy facilities for masses of people moving from the countryside. This demand from developing economies is putting a great strain on global copper supplies.

    Like most of the world's precious resources, copper also tends to come from nations with poor political conditions. Such countries as China, Chile and Peru are others that possess the biggest resources of copper have been beset by a preponderance of problems. Aside from the political woes, these nations also undergo geographical challenges such as natural calamities brought about by earthquakes and typhoons which all contribute to problems with satisfying current copper demands. These disasters, however, are commonplace within these nations but invariably cause drastic shifts in copper prices when they occur.

    Copper is seen by many as an indicator for global economic growth, and we usually see the movement of copper going in the same direction as equity markets and other industrial metals.

    Industrial Metals

    Industrial metals are utilised in all aspects of our daily lives and are a vital need for each developed and developing nation. Industrialisation and urbanisation in the BRIC economies (Brazil, Russia, India and China), has experienced a drastic growth in demand for such metals in the past decade. The number of people migrating from rural areas to many growing cities has reached a seemingly uncontrollable peak and it has been seen by majority that it will produce the most significant period of demand for industrial metals that will have been experienced ever since the start industrialisation.

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