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Bureau of Mines / Minerals yearbook: Minerals in the world economy 1989
Year 1989, Volume 3 (1989)

Kimbell, Charles L.; Zajac, William L.
Minerals in the world economy,   pp. 1-52 PDF (8.7 MB)

Page 1

By Charles L. Kimbell and William L. Zajac 
 This study is intended to serve three roles. First, it is an extension of
the previous works under the same title that have been the overview and summary
chapter of the international volume of Minerals Yearbook since the inception
of that volume. Following the traditional format of past chapters, the basic
statistical presentations herein deal chiefly with 1989, and in some instances
with 1988, the latter only because more recent, comprehensive global statistics
for 1989 are simpiy not yet available owing to delayed data collection and
processingin some countries and continued governmental suppression of data
in others. 
 The second role of this study is to provide an update to the coverage of
events impacting on the world's mineral industry that have occurred between
the end of 1989 and the preparation of this study. Inclusion ofthis update
is almost essential because ofthe potential effect of some of these events
on global mineral industry activities. 
 Finally, this study, in parallel with the regional volumes that it summarizes
and complements, includes limited materials on the short-term outlook for
the world's mineral industry, at least insofar as the impact of events covered
in the update can be examined. For simplification of outline, the update
through 1990 and outlook appear as a single section with regional subdivisions,
and follow the 1989 review. This format has been adopted because most of
the noteworthy events are regional in nature and most seem destined to have
their greatest impact on the specific regions rather than on the world as
a whole. 
 In overview, the world's mineral indus 
try in 1989 registered gains over its 1988 performance, but these gains were
by no means as pronounced as had been those of 1988. The traditional statistical
measures of mineral industry performance, namely production, trade, and consumption
levels, reflected significant growth in most industry sectorsfrom crude material
extraction through the gamut of downstream processing. Growth in market economy
countries generally exceeded growth in the centrally planned economy countries
as a result of a variety of causes that will be covered subsequently, but
even among the centrally planned countries there were some upturns. In contrast
to these measures of the soundness of the industry, the situation for nonfuel
mineral and metal prices wasless satisfactory than in 1988, andlow crude
oil prices continued as a problem for the all-important petroleum sector,
despite some gains during the year. The oil price situation mitigated against
price increases for competitive fuels. Although this was unfavorable for
fuel producers, it remained advantageous to consumers, including nonfuel
mineral producers, processors, and transporters. Thus it cannot be viewed
as a negative factor for the whole ofthe global mineral industry. 
 Global crude mineral output value was estimated at nearly $1,420 billion
in current dollars, an increase of 9% over the 1988 level, and an increase
in current dollar terms for the seventh consecutive year. Measured in terms
of constant dollars, however, adjusting for inflation, the increase was only
4.7% compared with the 1988 leveL Despite the prolonged growth trend, the
1989 crude mineral output value level was still 3.2% below the record high
set in 1980, which was $1,467 billion in terms of 1989 dollars. 
 Less precisely assessed was the value of mineral commodities moving in international
trade in 1989. The value of world mineral commodity export trade in 1988
was estimated at $542 billion in current (1988) dollars, and partial returns
suggested that the 1989 level would be in the range of $590 billion to $605
billion in terms of 1989 dollars. This would representa9%to 12% growth intenns
of current dollars, or a 5% to 7% growth in terms of constant dollars. In
any event, although the 1989 level was substantially ahead of that of 1988,
it was still far below the 1980 record high of almost $710 billion on a current
dollar basis or $1,046 billion in terms of 1989 dollars. This lower level
was almost entirely the result of much lower unit values for energy commodities
in the later years of the decade; substantially lower oil prices tended to
keep all energy material prices down through most ofthe later 1980's, although
there was a pronounced upturn in 1989. Certainly though, regardless of the
actual dollar value level of mineral commodity export trade, there was an
increase inthe quantity of materials being moved between 1988 and 1989. 
 Consumption ofthe majority of mineral commodities advanced in 1989, with
a number ofmaterials reachingnew recordhigh levels, but the gains were not
as impressive on a global basis as had been the increases registered in 1988.
 An assessment of 1989 worldwide mmeral industry investment is impossible
owing to the incomplete nature of available data. Steel industry investment
probably topped 1988 levels, at least in market economy countries, where,
for a selected group of countries, Bureau of Mines-collected data showed
an increase of almost 7.9% between 1987 and 1988. Returns for 
1989, however, were insufficiently cornplete to fix a growth rate. Foreign
investment in mining, smelting, and refining by U.S. firms slumped by almost
6% between 1988 and 1989, while the much larger U.S. overseas investment
in oil advanced only by 0.3%. These figures, however, cannot be regarded
as indicative of investment by 

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