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Investment policies in the base metal mining industries and their impact on price cycles
Author(s) -
Stobart Christopher
Publication year - 1991
Publication title -
natural resources forum
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.646
H-Index - 49
eISSN - 1477-8947
pISSN - 0165-0203
DOI - 10.1111/j.1477-8947.1991.tb00108.x
Subject(s) - business cycle , investment (military) , production (economics) , business , industrial organization , capacity utilization , natural resource economics , commerce , production cycle , economics , market economy , macroeconomics , engineering , politics , political science , law , manufacturing engineering
Investment in increased capacity of the major metal producers is examined in the light of changing metal prices and the business cycle. Historically, as metal prices rise, the producers have invested in new mine capacity. This process results in increased production which often comes on stream just as the business cycle is beginning to wane. During the present business cycle the investment pattern of the major mining companies appears to have broken with this historical pattern in that investment strategies are less directed toward increasing capacity.