China - The Engine of a Commodities Super Cycle Global

See Appendix A-1 for Analyst Certification and Important Disclosures

Alan Heap (612) 8225 4853 Sydney [email protected]

China - The Engine of a Commodities Super Cycle Commodity Update

Smith Barney is a division of Citigroup Global Markets Inc. (the "Firm"), which does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the Firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.

Glo

ba

l

SectorMappingA Global View

E Q U I T Y

R E S E A R C H :

G L O B A L

Commodities 31 March, 2005

! We believe a super cycle is underway, driven by materials intensive economic growth in China.

! A super cycle is a prolonged (decades) trend rise in real commodity prices, driven by the urbanization and industrialization of a major economy.

! There have been two super cycles in the last 150 years: late 1800s-early 1900s, driving economic growth in the USA; 1945-1975, prompted by post-war reconstruction in Europe and by Japan’s later, massive economic expansion.

! High and rising intensity of metals use is the most useful indicator of a super cycle. In China, intensity of use is now three times that of the USA, with demand driven by urbanization, industrialization and fixed capital formation. Importantly, the domestic market drives China’s metals demand, not exports.

! In past super cycles, supply has increased to meet higher demand growth.

! In the present super cycle, increased supply will come at relatively higher costs. Lead times are also increasing, contributing to extended periods of market tightness.

! Under these circumstances, higher long-term commodity prices should be used.

! Paper presented at the Mineral Economics & Management Society Annual Conference, Washington, April 2005.

China - The Engine of a Commodities Super Cycle - 31 March, 2005

2

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There have been two super cycles in the past 150 years. We believe a

third super cycle is underway, driven by China.

Super cycles are…

A super cycle is a prolonged (decade or more) trend rise in real commodity prices, driven by urbanization and industrialization of a major economy.

There have been two super cycles in the past 150 years: from the late 1800s, driven by the USA; and from 1945 to 1975 as a result of post-war reconstruction in Europe, and subsequently by the Japanese economic renaissance.

Super cycles are demand driven

Highly materials intensive economic activity is the cause of super cycles – intensity of metals use in the expanding economy is high, and global growth is moving to a higher trend.

China – the engine of the present super cycle

China accounts for an increasing share of global economic activity (12% of IP, up from 6% in 1995).

It accounts for around 20% of demand for copper and other commodities, and a much larger proportion of demand growth. Intensity of use is 3 times greater than that of the USA.

The drivers are urbanization, industrialization and fixed capital formation. Greatest metals demand exists in China’s domestic market – not its export market.

Supply responses – increased production at higher costs

In past super cycles, expansions in commodity production were not sufficient to offset stronger demand growth.

In the present super cycle, capital and exploration expenditure are increasing but is not expected to result in oversupply.

! costs are increasing, and

! production lead times are extending.

Inve

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3

Implications for long-term prices

The higher cost of new supply required to meet demand implies that higher long-term prices are appropriate for project evaluation and discounted cash flow analysis.

Figure 1. Appropriate Long-term (Equilibrium) Commodity Prices - 2005$

Commodity Unit Value

Copper US¢/lb 95 Aluminium US¢/lb 70 Nickel US$/t 3.50 Zinc US¢/lb 50 Lead US¢/lb 27 Oil US$/bbl 28 Iron Ore (Lump) US¢/Fe unit 45 Coking coal US$/t 62 Thermal coal US$/t 33 Source: Smith Barney estimates.

In this report we draw mainly on the copper market

The copper market has a number of attractions for this type of long-run historical analysis. It is a mature market. Consumption is relatively evenly distributed across geographical regions and a diversity of end uses, and it is correlated with general macroeconomic trends. Market data is relatively easy to obtain.

Preliminary analysis of other commodities shows similar trends and drivers, although some (such as aluminium and nickel) have shorter market histories.


4

Super Cycles are

Extended periods (decades) of trend rise in real prices…

For the last 30 years commodity prices have been in trend decline in real terms. But when viewed against a longer time period it is evident that this has not always been the case. In particular, commodity prices rose on a trend basis for two extended periods during the last 150 years: from the late 1800s through to the early 1900s; and from 1945 to 1975.

This pattern can be most clearly seen for copper (Figure 2), but most commodities show similar trends (Figure 3).

Figure 2. Copper Super Cycles

0

100

200

300

400

500

600

1885

1890

1895

1900

1905

1910

1915

1920

1925

1930

1935

1940

1945

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

US¢/l

b

nominal price2004 real price

Source: USGS; Platts; US Department of Labor.

Super cycles occurredin the late 1800s–early

1900s (driven byurbanization and

industrialization in theUSA), and in the late

1940s–early 1970s(driven by post war

reconstruction in Europeand Japan, and

subsequently theJapanese economic

renaissance).


5

Figure 3. Other commodities show similar trends...

Aluminium Nickel

0

50

100

150

200

250

300

350

400

1920

1925

1930

1935

1940

1945

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

US¢/l

b


0

2

4

6

8

10

12

14

16

18

20

1885

1895

1905

1915

1925

1935

1945

1955

1965

1975

1985

1995

US$/l

b


Zinc Steel

0

50

100

150

200

250

300

1885

1895

1905

1915

1925

1935

1945

1955

1965

1975

1985

1995

US¢/l

b


0

200

400

600

800

1000

1200

1885

1895

1905

1915

1925

1935

1945

1955

1965

1975

1985

1995

US$/t


Source: USGS; Platts; US Department of Labor.

It should be noted that in a super cycle, prices rise on a trend basis. There are still business cycles within a super cycle.

….driven by materials intensive economic growth as major economies urbanize and industrialize.

The key driver of these super cycles is materials intensive economic growth in major economies as they urbanize and industrialize.

This is reflected by high and rising intensity of use (IOU - the amount of copper consumed per unit of economic activity).

Aluminium & nickel arenew age metals.

Zinc & steel showsimilar trends to copper.


6

Figure 4. Copper - intensity of use

0.00

0.25

0.50

0.75

1.00

1.25

1.50

1.75

2.00

1900

1905

1910

1915

1920

1925

1930

1935

1940

1945

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

Inde

x

USA Germany Japan China

Source: USGS; US Dept of Labor; GGDC; Smith Barney estimates.

Figure 4 shows intensity of use based on GDP as the economic denominator.

In China, IOU is only just beginning to rise strongly.

In the USA, intensity rose strongly during the early 1900s, then plateaued and declined from around 1940 as its economy evolved. The highly materials intensive growth phase came to an end, as the economy became increasingly services-based.

In Europe, reconstruction post the 1939-45 war boosted intensity of copper use.

In Japan, intensity rose during the early years of its economic renaissance, but declined from 1980.

Declining intensity & slowing demand bring cycles to an end

Declining intensity of use brings super cycles to an end as the driving economy evolves from materials intensive infrastructure and manufacturing towards more service based.

We also believe declining demand brings typical business cycles to an end, rather than expanding supply (Figure 5).

Intensity of use peakedin the early 1900’s in the

USA, in the 1950’s inEurope and in the early

70’s in Japan.


7

Figure 5. Cycles in the Copper Market

-6.0%

-4.0%

-2.0%

0.0%

2.0%

4.0%

6.0%

8.0%

10.0%

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

e

2005

e

2006

e

2007

e

0

50

100

150

200

250

US

¢/lb

% chg Supply % chg Consumption Price (US¢/lb)

Source: Smith Barney estimates.

China’s Contribution to Global Growth

China’s contribution to global growth depends on how you measure it.

China accounts for:

! 4% of global GDP on an exchange rate basis.

! 13% on a purchasing power parity basis, up from 9% in 1995.

! 12% of world industrial production, up from 6% in 1995.

Figure 6. Regional Shares of Global Industrial Production

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

10,000

1980

1984

1988

1992

1996

2000

2004

US$b

n (1

987)

China

Other Asia

Rest

Europe

North America

Source: World Bank; Smith Barney.

Cycles are brought to anend by declining

demand. In some cycles(e.g. the mid 1990’s)supply continued to

increase, contributing toa prolonged downturn.

China accounts for 12%of world IP, up from 6%

in 1995.


8

Interestingly, China accounted for 20-30% of global GDP until the mid 19th century, when it was eclipsed by the USA. Perhaps China is on the way to regaining its past dominance, and perhaps this is the true expression of the super cycle (Figure 7).

Figure 7. GDP of Key Nations: 0-2004 A.D.

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%

0

1000

1500

1600

1700

1820

1870

1913

1950

1973

1998

2004

ROW

Japan

Germany

USA

India

China

Time scale Source: Maddison (OECD publication); Groningen Growth & Dlpmnt Cent., University of Groningen; Smith Barney estimates.

Super Cycles – Impact on Commodities Demand & the Role of China.

Figure 4 shows that intensity of use in China has begun to lift sharply.

The contention then is that:

Further materials intensive economic activity (as measured by rising intensity of use) in China will drive another super cycle.

Price super cycles are associated with higher levels of trend demand growth. Supply responses are discussed below.

China accounted for 20-30% of global GDP until

the mid 19th century,when it was eclipsed by

the USA.


9

Figure 8. Global Copper Consumption Trend Growth

-10%

-5%

0%

5%

10%

15%

1934

1937

1940

1943

1946

1949

1952

1955

1958

1961

1964

1967

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

5 yea

r mov

ing

aver

age

trend 4.8%/yrtrend 2.5%/yr

Source: Metallgesellschaft (1929-1980); WBMS (1980-present).

While China’s demand for copper (and commodities in general) has been growing for some years, it virtually exploded in 2000.

Figure 9. Global Copper Demand

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

16,000

18,000

20,000

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

kt

Rest

Korea, Taiwan &Other Asia

Europe & OtherOECD

China

Japan

USA

Source: WBMS; Smith Barney estimates.

Price super cycles areassociated with higherlevels of trend demand

growth.

In 1999 China accountedfor 10% of world

consumption. In 2004 itreached 20%.


10

China now accounts for around 20% of global demand for a broad range of commodities, and an even larger proportion of growth in demand.

Figure 10. China�s Contribution to Commodities Demand

Commodity China's share of global consumption

China's contribution to y-o-y consumption growth

2002 2003 2002 2003Cement 34% 56%Ethylene 6% 6% 23% 5%Alumina 16% 19% 60% 59%Aluminium 16% 19% 39% 53%Copper 18% 20% 112% 78%Nickel 8% 10% 13% 48%Zinc 19% 21% 53% 86%Iron ore 26% 29% 39% 70%Steel 23% 27% 77% 84%Gold 6% 7% 3% -5%Platinum 23% 18% 75% -560%Pulp 18% 27% 18%Container board 11% 30% 11%Crude oil 7% 8% 57% 40%GDP 4% 3% 7% -16%Population 21% 21% 11% 11%


Some of the dynamics can be seen in Figure 11. (In this data industrial production is the denominator of intensity of use, rather than GDP shown earlier).

Figure 11. China's Copper Demand

-30%

-20%

-10%

0%

10%

20%

30%

40%

50%

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Cons

umpt

ion

& IP

(% ch

yoy)

0.0

1.0

2.0

3.0

4.0

5.0

6.0

IOU

IPConsumptionIOU


China now accounts foraround 20% of global

demand for a broadrange of commodities,

and an even largerproportion of growth in

demand.

Intensity in China hasincreased sharply since

1999…


11

And can be compared with the USA in Figure 12.

Figure 12. USA's Copper Demand

-30%

-20%

-10%

0%

10%

20%

30%

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

Cons

umpt

ion

& IP

(% ch

yoy)

0.0

0.2

0.4

0.6

0.8

1.0

1.2

1.4

1.6

1.8

IOU

IPConsumptionIOU


Drivers of demand –fixed capital formation

Fixed capital formation is an important driver of metals demand in China. Fixed capital formation has increased to around 40% of GDP. Although there is concern that this may prove unsustainable, we expect fixed capital formation to stabilize at around 50% of GDP, but for the growth rate to slow more rapidly than the broader economy.

Figure 13. China - Changing Share of Gross Capital Formation in GDP, 1952-2003 (%)

10

15

20

25

30

35

40

45

50

1952

1956

1960

1964

1968

1972

1976

1980

1984

1988

1992

1996

2000

2004

%

Source: National Statistics Bureau of China; CEIC Data Company; Smith Barney estimates.

…and it is now 3 timesthat of the USA, whereintensity is declining.

Fixed capital formationis increasing as a

percentage of GDP. It isexpected to stabilize at

around 50%


12

Figure 14. China's GDP & Gross Capital Formation, 1991-2006

0

5

10

15

20

25

30

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

e

2006

e

%

GDP by Industry %

Gross Capital Formation %

Source: National Statistics Bureau of China; CEIC Data Company; Smith Barney estimates.

Drivers of demand – urbanization

Urban migration is an important driver of fixed capital formation and super cycles. In China, 10 million people per year are moving from the countryside to the cities, according to World Bank estimates, and this may increase four fold as restrictions on the movement of labour are relaxed as required by the WTO.

Urban migration was also a driver of past super cycles, but fixed capital formation probably did not reach the proportion of GDP seen in China.

Drivers of demand-domestic consumption

At least 50%, and perhaps 75%, of China’s copper demand is for domestic consumption.

Figure 15. China's Copper Consumption, by use

Construction28%

Infrastructure24%

OEM & General48%

Source: Bloomsbury Mineral Economics.

Fixed capital formationhas been growing at

around 20%/yr, but isexpected to slow more

rapidly than the broadereconomy.

At least half of China’scopper demand is for

domestic consumption.


13

Therefore, China’s copper demand is not export driven, nor is a result of a relocation of manufacturing capacity from other countries.

This is also an important characteristic of past super cycles. For example, the super cycle of the 1960s and early 70s faded as Japanese internal development matured, even though exports continued to grow. It is also notable that the boom of the Asian tigers in the early 1990s, which was an essentially export driven phenomenon, did not translate into a super cycle.

Supply Responses in Super Cycles

Copper mine supply from 1900 is shown in Figure 16.

Figure 16. Copper mine production since 1900

0

2,000

4,000

6,000

8,000

10,000

12,000

14,000

1900

1905

1910

1915

1920

1925

1930

1935

1940

1945

1950

1955

1960

1965

1970

1975

1980

1985

1990

1995

2000

kt

Australasia

Latin America

N.America

Asia

Africa

Europe

Source: Metallstatistik; WBMS; Smith Barney estimates.

This is combined with demand to show supply-demand balances in Figure 17.

Figure 17. Copper Supply-Demand Balance & Price

0

50

100

150

200

250

300

350

400

1928

1931

1934

1937

1940

1943

1946

1949

1952

1955

1958

1961

1964

1967

1970

1973

1976

1979

1982

1985

1988

1991

1994

1997

2000

2003

US¢/l

b

-1200

-1000

-800

-600

-400

-200

0

200

400

600

800

1000

1200

Surp

lus/D

efict

(kt)

Surplus/Deficit Price Source: Metallstatistik; WBMS; Smith Barney estimates.

Supply increases insuper cycles.

Super cycles are notassociated with

persisting supplydeficits.


14

From an analysis of this data, we conclude that super cycles are not associated with persisting supply shortfalls. Supply typically expands in response to growing demand, but production costs also increase. This supports our view that super cycles are demand driven. We believe this is the outlook for the present super cycle, as discussed below.

Changes in the sources of copper supply since 1900 is illustrated in Figure 18.

Figure 18. Copper mine production - regional contributions

0%

20%

40%

60%

80%

100%19

0019

0519

1019

1519

2019

2519

3019

3519

4019

4519

5019

5519

6019

6519

7019

7519

8019

8519

9019

9520

00

Australasia

Latin America

N.America

Asia

Africa

Europe

Source: Metallstatistik; WBMS; Smith Barney estimates.

The chart highlights how the geographical centre of copper production shifts over time as the economically accessible resources of major mining provinces are depleted. North American production dominated global supply in the first half of the 20th century, eventually giving way to Africa – a major producer in the 1950s and 60s. Latin American has been the pre-eminent copper-producing region since the early 1990s

There is no known mineral province comparable to that of Latin America that can be developed over the next 5-10 years to deliver new supply at relatively low cost.

Influence of Technology

The rapid advancement of technology is sometimes cited as a dampening influence on an emerging super cycle. However, on-going technical innovations have been a long-standing feature of the global mining industry – they are not a recent phenomenon.

The geographical centreof production shifts overtime as the resources of

each province aredepleted.


15

Figure 19. Copper industry developments - a history

1862 Bingham Canyon discovered 1898 Bulk mining introduced at Kennecott using steam-powered shovels 1906 Bingham Canyon start-up 1930 Introduction of open pit mining 1963 Bougainville discovery 1968 SxEw introduced in USA 1972 Ertsberg start-up 1974 Bougainville start-up 1984 Ok Tedi start-up 1990 Escondida; Olympic Dam start-ups 1990 Chilean production expands substantially 1995 La Candelaria start-up 1997 El Abra start-up 1998 Collahuasi start-up Source: Smith Barney.

While it is difficult to identify new technologies under development, they are likely to have the same impact on the copper market (increasing supply, lowering costs) as did solvent extraction and electro-winning in the 1990s.

The Capital Cycle

Capital spending typically lags the commodity price cycle (Figure 20).

Figure 20. Metals & Mining Capex

0

5

10

15

20

25

30

35

40

45

50

1978

1980

1982

1984

1986

1988

1990

1992

1994

1996

1998

2000

2002

2004

2006

Cape

x (US

$bn)

0

50

100

150

200

250

Base

Met

als R

eal P

rice I

ndex

Metals & Mining Capex (Real 2004)

Base Metals Real Price Index (2004=100)


The base load of stay-in-business capital spending is around US$15bn per year, although there are indications that this is increasing. Peaks above this base represent spending on new projects.

The excess capital expenditure of the late 1990s, combined with a slowdown in demand following the Asian crisis, contributed to the subsequent prolonged recession in commodity markets that extended from the mid 1990s until 2004. This pattern reflects that illustrated in Figure 5.

A capital cycle is underway at present. But, increasing production costs mean that higher capital expenditure is likely to translate into a relatively small expansion in production. Furthermore, increasing lead times due to environmental permitting

The capital cycle lagsthe commodity price

cycle.

Technical advanceshave been a long-

standing feature of theglobal mining industry.


16

and more stringent capital budgeting will delay the expansion of current operations.

Exploration expenditure is also increasing. Again though, long lead times threaten to delay the conversion of these projects into new supply sources (Figure 21).

At this stage, we see no sign of oversupply emerging.

Figure 21. Worldwide Non-ferrous Exploration Budgets

0

1

2

3

4

5

619

94

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

US$b

n

Source: Metals Economics Group.

Production costs and margins

Data on production costs and margins in past super cycles has proved elusive. However, we surmise that cost increased as production rose to meet demand.

Over the last 25 years or so, production costs have been declining on a trend basis, as have prices (Figure 22).

Figure 22. Copper Costs, Prices & Margins

020406080

100120140160180200220240

1980

1981

1982

1983

1984

1985

1986

1987

1988

1989

1990

1991

1992

1993

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

2010

2011

2012

Cost

& P

rice (

US¢/l

b)

Real cash cost (2004 US¢/lb)Real LME Cu price (2004 US¢/lb)

equilibrium cost

Long-term

equilibrium price

Source: Brook Hunt; CRU; Smith Barney estimates.


17

Over the last year, costs have increased sharply – although largely from cyclical factors including fuel prices, consumables and labour.

However, we also believe production costs are likely to continue rising on a structural basis. The additional supply required to meet higher trend demand growth will be higher cost.

Margins are expected to remain constant, and prices will be driven higher.

Implications for long-term prices

We believe this environment means that it will be appropriate to adopt higher long-term (equilibrium) prices for project evaluation and discounted cash flow valuations.

Higher trend demand growth will be met by higher cost production. Industry average margins will remain constant. As a consequence, prices will trend higher.

Our approach to deriving long-term prices differs from traditional mineral economics dogma.

Dogma dictates that the equilibrium price is the capital cost of new production, plus a return on the investment. The flaws we see with this are that 1) it ignores the influence of existing production capacity, in which costs are largely depreciated and 2) mining operations rarely return their cost of capital.

Our approach to determining long-term prices is shown schematically in Figure 23.

Figure 23. Cash Costs vs. Prices � a shift in the curves

0

0.2

0.4

0.6

0.8

1

1.2

0 0.2 0.4 0.6 0.8 1 1.2

Previously forecast cost

Previously forecast LT price

New forecast cost curve

New forecast LT price

Cumulative Production

Cost

& P

rice

Source: Smith Barney.

Given higher demand growth, the long-term price is a function of costs and margins. If the average cost increases, and margins remain constant, the long-term price will increase.

Long term price will risewith increasing costs.


18

Implications for trough prices

A further consequence of the super cycle is that as the current business cycle slows, prices will likely decline to a relative trough level set higher than those reported for recent industry downturns (1993, 2001).

Figure 24. Cash Costs vs. Prices - parameters

Years

Cost

& P

rice Real cash costs

Real pricesTrend real price


Iron ore – a different market

Figure 25. Iron ore Costs, Prices & Margins

05

101520253035404550556065

1994

1995

1996

1997

1998

1999

2000

2001

2002

2003

2004

2005

2006

2007

2008

2009

Cost

& P

rice (

US¢/F

e unit

)

0%

10%

20%

30%

40%

50%

60%

70%

Cash cost (2004 US¢/Fe Unit) Price (2004 US¢/Fe Unit) Margin %

Long-term

equilibrium cost

equilibrium price

equilibrium margin

Source: Brook Hunt; CRU; Smith Barney estimates.

The history of iron ore costs and margins is starkly different from that of copper. Its industry has seen sustained margin expansion. Persisting tight markets mean that margins will probably be sustained.

Trough margin 10% Average margin 39% Prev. equil price 05 US¢85 New equil price 05 US¢95 Prev. trough price 05 US¢65 New trough price 05 US¢72

In the next downturn,trough prices will behigher than those of

previous cycles.


19

Figure 26. Appropriate Long-term (Equilibrium) Commodity Prices - 2005$

Commodity Unit ValueCopper US¢/lb 95Aluminium US¢/lb 70Nickel US$/t 3.50Zinc US¢/lb 50Lead US¢/lb 27Oil US$/bbl 28Iron Ore (Lump) US¢/Fe unit 45Coking coal US$/t 62Thermal coal US$/t 33Source: Smith Barney estimates.


20

Appendix 1: References

Bloomsbury Mineral Economics (BME), 2005 [Online] Available at: http://www.bloomsburyminerals.com/

CEIC Data Company, 2005 [Online] Available at: http://www.ceicdata.com/

Groningen Growth and Development Centre (GGDC), 2005 [Online] Available at: http://www.ggdc.net/index-dseries.html

MADDISON, A. 2001, The World Economy - A Millennial Perspective, OECD Development Centre, Paris

Metallstatistik (historical commodity production data, 1900-1990), subscription to combined WBMS & CRU research

Metals Economics Group, 2005 [Online] Available at: http://www.metalseconomics.com/meglogin.html

National Bureau of Statistics of China, 2005 [Online] Available at: http://www.stats.gov.cn/english/

U.S. Department of Labor, 2005 [Online] Available at: http://www.bls.gov/

U.S. Geological Survey (USGS) 2005 [Online] Metal Prices in the United States through 1998, Available at: http://minerals.usgs.gov/minerals/pubs/metal_prices/

World Bank, 2005 [Online] Available at: http://www.worldbank.org/data/

World Bureau of Metal Statistics (WBMS), (compiled, 1980-present), World Metal Statistics Monthly Reports, WBMS, London


21

Appendix 2: Historical Price Data Details

Copper 1850-96, New York price for Lake copper (99.9%-pure copper), in Loughlin, G.F., Prefatory note on the report on gold, silver, copper, lead, and zinc, Mineral Resources of the United States 1922, Part I, U.S. Geological Survey, 1925, p. 127a.1897-98, New York price for Lake copper (99.9%-pure copper), in Engineering and Mining Journal.1899-1908, Electrolytic (99.9%-pure copper) refinery price in New York, in Engineering and Mining Journal.1909-22, Electrolytic (99.9%-pure copper) domestic f.o.b. refinery, in American Metal Market.1923-72, Electrolytic (99.9%-pure copper) domestic delivered to Connecticut price, in American Metal Market.1973-77, U.S. producer electrolytic (99.9%-pure copper) wirebar, in Metals Week.1978-2004, U.S. producer cathode (99.99%-pure copper), in Metals Week (1978-92) and Platt�s Metals Week (1993-2004).

Aluminium 1850-94, in U.S. Geological Survey Minerals Yearbooks and predecessor volumes.1895-98, 98%-pure aluminum, in American Bureau of Metal Statistics.1899-1900, 99%-pure aluminum ingot, in American Bureau of Metal Statistics.1901-04, 99.75%-pure aluminum ingots in 2,000-pound lots, in American Bureau of Metal Statistics.1905, 99.75%-pure aluminum ingots in 2,000-pound lots, in American Metal Market/Metal Statistics, 1955.1906-19, 99%-pure No. 1 aluminum ingots, in American Metal Market/Metal Statistics, 1955.1920-21, 98%- to 99%-pure aluminum, in American Metal Market/Metal Statistics, 1955.1922-28, 98%-pure aluminum metal, in American Metal Market/Metal Statistics, 1955.1929-35, 99%-pure aluminum metal, in American Metal Market/Metal Statistics, 1955.1936-54, 99%-plus pure aluminum virgin ingot, in American Metal Market/ Metal Statistics, 1955.1955-56, 99%-pure aluminum virgin ingot, in Engineering & Mining Journal.1957-71, 99.5%-pure unalloyed aluminum ingot, in Engineering & Mining Journal.1972, 99.5%-pure unalloyed aluminum ingot, in Metals Week.1973-82, U.S. market spot price, in Metals Week.1983-92, 99.7%-pure aluminum ingot, U.S. market spot price, in Metals Week.1993-98, 99.7%-pure aluminum ingot, U.S. market spot price, in Platt�s Metals Week.1999-2004, LME

Zinc 1875-1904, New York price for Prime Western zinc (98% pure), in Ingalls, W.R., Lead and Zinc in the United States, McGraw-Hill, NY, 1980, p. 342.1905-70, St. Louis/East St. Louis producer price for Prime Western zinc, in American Metal Market/Metal Statistics.1971-79, U.S. Dealers Prime Western delivered price, in Metals Week.1980-93, U.S. Dealers High Grade zinc (99.9% pure) delivered price, in Metals Week.1994-2004, U.S. Dealers Special High Grade zinc (99.99% pure) delivered price, in Platt�s Metals Week.

Nickel 1850-1912, Price of refined metal, as supplied by Inco Ltd.1913-21, Price of refined metal, Historical Statistics of the U.S., Colonial Times to 1970, U.S. Dept of Comm, Census Bureau 1922-45, Price quoted by Inco for electrolytic Ni cathode at NY, in 2-short-ton minimum lots, in US Bureau of Mines Yearbook.1946-47, Contract price to US buyers of electrolytic Ni cathode in carlots, fob. Port Colborne, Ont, incl. 2.50¢/lb duty, in US Bureau of Mines Yearbook; 1948-61, Contract price to US buyers of electrolytic nickel cathode in carlots, fob. Port Colborne, Ont, incl. 1.25¢/lb duty, in U.S. Bureau of Mines Yearbook. [duty halved on January 1, 1948]1962-79, Contract price to U.S. buyers of electrolytic nickel in carlots, f.o.b. Port Colborne, Ontario, in American Metal Market. Weighted average for the year. U.S. import duty of 1.25¢/lb was suspended September 27, 1965.1980-93, LME cash price for primary Ni (min. 99.80%, cut cathodes, pellets, briquets, 6t lots), Metals Week [through June 14, 1993].1993-2004, LME cash price for primary primary Ni (min. 99.80%, cut cathodes, pellets, briquets, 6t lots), Platt�s Metals Week.

Steel 1897-February 1987, hot-rolled carbon steel bars merchant, Pittsburgh base, dollars per cwt., in AmericanMarch 1987-1998, hot-rolled carbon SBQ (special bar quality) 1000 series, in American Metal Market.1998-2004, Metal Bulletin

Source: USGS.


22

Notes


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