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By C. J. Roos

Ground engaging tools are used to prevent damage to the main components of earth-moving equipment. These tools consist of everything from shovel teeth to replaceable drill bits to dozer wear plates. The costs of these ?consumable? items are increasing with the costs of raw materials. This project developed a tool to be used by Newmont Mining Corporation to predict the consumption of excavator teeth. This paper presents the results of a Montana Tech research project in which an equation was developed to predict excavator teeth consumption based on production rates and rock properties.

Jan 1, 2009

By R. A. Reiley

Introduction Democratic countries are founded on the principle that all citizens have the right to participate in policy setting and decision-making processes. Citizen participation is especially evident in environmental issues and policies. In the United States, there are currently over 10,000 environmental organizations and new ones are being formed each year. Many of these organizations are formed on a watershed basis and are particularly concerned about the impact mining has on the environment. While the environmental issues vary from area to area, most concerns center around mining impacts related to subsidence, water pollution, and water diversion. Citizens have a number of avenues for participating in lawmaking that affects the mining industry. Some of these avenues include participation in litigation and citizen ballot initiatives. In addition, there are less formal methods of participation that include attending public meetings, commenting on agency rules or lobbying on specific legislation. The intent of this article is outline the various public participations mechanisms, highlight the latest legal developments that have affected mining industry through citizen participation, and briefly discuss emerging issues.

Jan 1, 2001

By S. J. Neethling

The flotation froth structure and motion determines the amount of entrained gangue that is collected to the concentrate. Despite this important role in the overall performance, the behaviour of the froth is still ill understood. To date, predominantly empirical models have been developed to describe entrainment. A fundamentally based model is described and used here in an attempt to improve the understanding of entrainment. This general froth simulator (UMIST FrothSim) allows the modelling of a wide range of flotation conditions, as it takes account of a large number of the physical phenomena that occur within flotation froths. The model firstly describes gas motion and bubble coalescence, and the water motion based on gravitational, viscous and capillary effects. The motion of the solids distinguishes between various solids classes based on hydrophobicity, particle size and density and models them by including the effects of Geometric and Plateau border dispersion, particle settling and the motion of the water. The aim of this paper is to show the applicability of this model to explain the observed entrainment and collection of gangue. This is done by comparing model predictions with the experimentally observed relationship between the gangue and water recoveries. The model predicts the identical trends, which are explained in terms of the interaction between the linear effects of water motion and hindered settling and the non-linear effect of particle dispersion.

Jan 1, 2001

By R. Q. Phillips

INTRODUCTION Since Canada commenced sulphur exports in the early 1960's, the volume of exports has grown steadily and by 1984 Canadian sulphur accounted for 45% of internationally traded sulphur. In 1984 a total of 7.6 million tonnes of Canadian sulphur was shipped to offshore markets and the U.S.A. Total shipments, including domestic sales, were 8.3 million tonnes. With a production of some 5.6 million tonnes, inventory was drawn down by nearly 3 million tonnes in order to keep pace with demand. Since 1979, world consumption has exceeded total world production and Canadian sulphur inventory has played a truly crucial role in balancing world supply and demand. Consequently, by the end of 1984 the Canadian inventory, which stood at 21 million tonnes in 1978, had been almost halved to 12 million tonnes. This inventory, however, is still by far the largest in the world and will continue to play a vital role in the world supply until expected depletion around 1990. Canada is the world's second largest producer of sulphur following the U.S.A.. The Current production level of between 5 and 6 million tonnes per annum is forecast to be maintained to 1990 with only a marginal fall in that production level in the following decade to the year 2000. This will ensure that Canada retains its position as one of the largest producers and most important suppliers of sulphur in the world market well into the future. CANADA AS WORLD SUPPLIER OF SULPHUR Since Canada commenced sulphur exports in the early 19601s, exports have grown steadily. (Figure 1) The rate of growth accelerated in recent years and in 1984 a total of 7.6 million tonnes was sold for export, compared to 3.0 million tonnes in 1975 and less than 1 million tonnes in 1964. World trade in sulphur also increased during this period, from 11 million tonnes in 1975 to 17.0 million tonnes in 1984 (Figure 2). Most of this increase in volume was accounted for by Canada and Poland. As a result, the importance of Canada as world supplier expanded from 28% in 1975 to 45% in 1984. The markets for Canadian sulphur can be divided into two broad categories, i.e., solid and liquid (Figure 3). The solid market is the largest, taking about 70% of Canadian output, virtually all of which is sold offshore. The U.S.A. and the Canadian domestic market take about 20% and 10% respectively, in liquid form. In 1984, (figure 4) total Canadian sulphur sales exceeded 8 million tonnes with offshore export sales at a record 5.8 million tonnes and sales to the U.S. of 1.8 million tonnes. Domestic sales accounted for only 0.7 million tonnes. The general trend for offshore export sales has been upward whereas there has been relative stability in domestic sales. The exceptional growth in offshore sales in the 1970's necessitated considerable capital investments by the industry in order to establish a logistics system capable of handling increasing offshore tonnages. Over 50 sulphur plants are currently operating in Alberta and British Columbia. Some of these are connected by rail, (Figure 5) the balance being generally connected by road. There are currently fourteen of the larger rail-connected plants designated as export plants, and these are equipped with sulphur forming facilities. The long distances between these plants and tidewater terminals in Vancouver is a very significant factor in complex logistics of Canadian offshore sulphur exports (Figure 6). Alberta and B.C. plants are located an average of 1,400 kilometers from tidewater.

Jan 1, 1986

By Barbara C. Schickner

The long-awaited COSMAR study prepared under the auspices of the National Academy of Science reaches one emphatic conclusion that has been enthusiastically seconded by the mining industry: The 1977 federal surface mining act is "poorly suited" as a vehicle to regulate noncoal mining. Though the industry greeted the report with approval, the weight it will carry and the extent of its impact are yet to be felt. The COSMAR report makes no recommendations-that's a job left to the Administration's Council on Environmental Quality-and the prospect of legislation still hovers. For a closer look at the study, MINING ENGINEERING talked to COSMAR committee chairman James Boyd, a well-known presence in the mining arena for over 50 years. After highlighting some of the study's major points, Dr. Boyd comments on the report's impact and possible repercussions. Dr. Boyd, for those readers who haven't seen the COSMAR report, would you summarize some of its major findings? The committee analyzed the surface mining act to determine if it was applicable to noncoal mining and found that there were provisions of the act that either could not be met by existing technology or would be extremely difficult and not necessarily beneficial to adapt. We found that most noncoal mineral mines, despite their obvious diversity, can be considered in two major groups: 93% of all mines move 45% of all materials mined (mostly small units mining construction materials); and the few gigantic regional operations (2%)-copper, iron, phosphate, and uranium mines-that move 50% of the material. With few exceptions, neither of the two groups is amenable to the coal mining practices addressed by the act. The strip mine law was designed for coal mining, where land is regraded, revegetated, and returned to usefulness. In contrast, construction mineral quarries supply local needs for decades, remove most of the material from the immediate vicinity, and cannot be returned to their premining uses (though they have innumerable other valuable uses). The nation's huge mineral deposits require enormous capital investments, are vital to the nation's economy, and can take centuries to exploit. Any attempt to return these locations to premining use would be illogical. Pebble phosphate in Florida and red-bed copper in Oklahoma come near to meeting the conditions contemplated in the act. In addition to COSMAR's basic finding, the study also makes the following points: •Mining uses a relatively small part of the land resource, in contrast to

Jan 4, 1980

By M. Fornaro, E. Lovera, I. Sacerdote

"The analysis of the mining laws of the different European States reveals big diversities and, often, remarkable complications. This is due, firstly, to the history and culture of different States and, secondly, to the assets of natural resources. It is therefore difficult to find a common line between the text of the various mining laws, but it can be observed that nearly all the States distinguish the mining resources in two categories: the materials whose importance is considered strategic belong to the first category; in the second category the materials whose importance (above all economic) is mainly local are comprised. The paper, analysing in detail the planning procedures in some important Countries, investigates the possible perspectives of arranging some guide-lines for a correct approach to the sustainable exploitation planning/programming of mineral resources (with particular reference to "quarry" materials, such as aggregates), considering both the environment protection and the production needs."

Jan 1, 2005

By Syd S. Peng, C. Y. Chen

Introduction The Surface Mining Control and Reclamation Act was passed in 1977 to put an end to the uneven environmental standards and enforcement established by various coal mining states in the US. One year after passage, the Secretary of Interior was directed to promulgate permanent program regulations implementing Title V provisions of the Act. These regulations were to form the basis for state regulatory programs under the Act and to allow states to assume primary regulatory responsibility. To implement the underground mining provision of the Act, the Secretary is directed in section 516(a) of the Act to promulgate rules. But they must take into consideration the differences between surface and underground coal mining. The regulations developed by the Secretary in 1979, with respect to subsidence control, included: • a subsidence control plan as part of the permitting process; • substantive provisions establishing performance standards for subsidence control; and • provisions providing for the prohibition of mining under perennial streams, impoundments larger than 24.6 dam3 (20 acre ft), and certain public facilities and urban areas. Industry challenged the Secretary's regulations implementing the subsidence control provisions. The litigation was consolidated with all other challenges to the permanent program regulations. (Permanent Surface Mining Regulation Litigation, Civil Action No. 79-1144; D. D.C., May 16, 1980.) In two opinions dealing with the multitude of issues raised by both industry and environmental groups, the US District Court of the District of Columbia ruled against industry. It upheld the promulgated subsidence control provisions. The US Court of Appeals stayed the appeals pending the agency's review and revision of its regulations. The regulatory reform was conducted in accordance with the order from the Secretary of Interior and the President in 1981. As a result, the subsidence control regulation was revised, reproposed, and finalized in June 1983 (Federal Register). This regulation, along with others, was again challenged by environmental groups and industry. On Oct. 1, 1984, the court, after finding the Secretary's reading of the Act reasonable, upheld the 1983 subsidence regulation except for one section. On Feb. 21, 1985, in accordance with the court's ruling, the Office of Surface Mining (OSM) suspended a portion of 30 CFR 817.121 (c)(2) concerning the damage correction requirement for structures or facilities and reproposed it on July 8, 1985 (Federal Register). In conjunction with a request for public comments, OSM now also seeks comments on the omission from the 1983 rule of the requirement in the 1979 rule regarding a presubsidence survey and monitoring of damage to structures. Technical issues related to subsidence regulations The subsidence regulations of June 1, 1983, consist mainly of two parts: a subsidence control plan as part of the permitting process; and substantive provisions establishing performance standards. The latter also includes provisions for prohibiting mining under certain areas. Under subsidence control plan section 784.20, minimum require-

Jan 2, 1986

Analysing a flotation plant?s operating performance requires accurate metallurgical sampling. Typically, the aims of performing flotation plant surveys are to establish a consistent and accurate understanding of the operation of the circuit as well as to identify potential areas for improvement. Once the data have been collected, a mass balance is required to provide a consistent set of data from which plant performance can be assessed. Mass balancing is a key skill that many metallurgists and mining industry professionals are familiar with. Mass balancing reconciles the feed and product streams throughout the plant and is sometimes used for accounting of the material entering and leaving a system (eg. JKMetAccount). However more common reasons for mass balancing are: better understanding of the flowrates within a system, assessing the quality of data obtained from sampling and surveys, and providing a key dataset for assessing and improving the performance of unit operations. Mass balancing requires practice and experience to determine if the results are reasonable. There are various software programs available to assist in the mass balancing and understanding of processing plants. This paper is focused on JKMultiBal initially developed by Gay (1993), and then later commercialized by JKTech. JKMultiBal in its current release is for balancing data in both one and two dimensions, i.e. balancing data on either sized or assay bases as well as size-by-assay. With the recent trend in flotation circuits becoming more complex, JKMultiBal has been used to gain a better understanding of the processes occurring within the circuit. This paper provides a description of the program as well as several case studies where the two-dimensional mass balancing has resulted in improvements in plant performance.

Jan 1, 2009

By William R. Yernberg

The combined 79th Annual Minnesota Section of SME Meeting and 67th Annual University of Minnesota Mining Symposium was held April 11 and 12, 2006, in Duluth, MN. About 300 mining professionals attended, including engineers, executives, mining managers and suppliers, from throughout the United States and Canada. This year’s theme was “Success in the New World of Mining.” The SME Minnesota Section meeting included a keynote session, a special projects update, a general managers update and technical paper presentations. The University of Minnesota Mining Symposium program featured a panel discussion on Minnesota’s relationship with China. The combined meeting included a trade-show consisting of 64 booth spaces. Tradeshow demand exceeded expectations, and an additional 10 booth spaces were added in the registration lobby. Also included were an SME short course on pump basics and social events.

Jan 1, 2006

By J. M. Mutmansky, Y. J. Wang

The usual method employed to determine the direction of flow in a connecting airway in advance is to conduct a survey between the two existing nodes being connected by means of the new airway. It is then assumed that airflow will take place from the node with higher pressure to the node with lower pressure. The purpose of this paper is to examine this direction-of-flow problem -- using properties of the system characteristic curve for a two-terminal network -- and specify some conditions that ensure that flow will take from the higher-pressure node to the lower-pressure node. It is concluded that the only requirement is that all characteristic curves of fans in the network should be strictly decreasing. Five numerical examples illustrate some important properties of the direction-of-flow problem.

Jan 1, 1999

By C. Chamberlain

The mining industry continues to underpin the regional economy. Australia, benefiting from a weak currency, receives 27% of the total goods export value from non-energy mining lead by aluminium, iron ore, gold and nickel. Consolidation has eliminated CRA, Comalco, North, Savage, Acacia, Ashton, Great Central, Aberfoyle, Placer Pacific, Plutonic, Normandy and RGC leaving Rio Tinto, BHP-Billiton, WMC, MIM and, increasingly, the South African companies Anglo, Gold Fields and Harmony as dominant players. Exploration stagnates with expenditure dropping 40% in Australia and 80% in PNG from peak levels. Major new regional developments include Rio’s West Angles iron ore project, Newcrest’s Ridgeway gold-copper mine and Inco’s Goro nickel-cobalt project in New Caledonia.

Jan 1, 2002

By J. Um, B. Morin, P. H. S. W. Kulatilake

Development of a three-dimensional mine visualization model for a section of the mine is addressed first. Discontinuity orientation and location information was taken from this visualization model for use in slope stability analyses. Estimated shear strength properties of discontinuities and mechanical properties of intact rock from the rock mass samples obtained from the mine are discussed next. The paper is then focused on the calculated maximum safe slope angles based on the performed kinematic and block theory analyses using the mapped discontinuities at the mine. Finally, the effects of water that exist in the rock mass, tension cracks, slope face inclination, overall wedge height and double benching on factor of safety of wedge stability are illustrated through limit equilibrium slope stability analyses.

Jan 1, 2002

By R. L. Guerguerian

Critical fasteners are described as they apply to the specification, manufacture, and assembly on large grinding mill bolted joints. The importance of adequate design methods, related joint diagrams and pivot analyses, and special emphasis on the quality of manufacturing and the tightening procedures in the field, are discussed; all in an effort to ensure high availability plant operation.

Jan 1, 2001

By Susana Bolhão Muiños, José Hipólito Monteiro, Martin Frank, James R. Hein, Henrique Garcia Pereira, Fátima Abrantes, Tracey Conrad, Luís Gaspar

In spite of all the work that has already been done on ferromanganese deposits, studies on the Atlantic Ocean occurrences are still in their infancy and there is a clear need for investigations concerning the origin, distribution, and resource potential assessment of these deposits. Nevertheless, studies already carried out on northeast Atlantic seamounts indicate the general presence of ferromanganese deposits of hydrogenetic origin, i.e. deposits formed by direct precipitation of colloidal, hydrated metal oxides that are scavenged from the water column on hard-rock substrates. The hydrogenetic precipitation promotes the enrichment of ferromanganese crusts in many trace metals, most of which are of economic interest, such as Co, Ni, Te, rare earth elements, and platinum-group elements and thus ferromanganese crusts are considered an important metal resource.

Sep 1, 2014

By Philip Weaver

The MIDAS project is funded by the European Commission (DG Research) and began on the 1st November 2013. The project will investigate the environmental impact of deep-sea mineral and energy extraction: specifically, polymetallic sulphides, manganese nodules, cobalt-rich ferromanganese crusts and the potential mining of rare earth elements. As deep-sea mining becomes ever closer, and the International Seabed Authority begins to develop its regulatory framework for exploitation of deep-sea minerals, MIDAS is well timed to provide fundamental scientific information. The MIDAS partnership represents a unique combination of scientists, industry, social scientists, legal experts, nongovernmental organisations and small and medium enterprises. MIDAS is carrying out research into the nature and scales of the potential impacts of mining including 1) physical disturbance of the seabed by mining, the creation of mine tailings; 2) the potential effects of particle-laden plumes in the water column, and 3) the possible toxic chemicals that might be released by the mining process. Key biological unknowns, such as connectivity between populations, impacts of the loss of biological diversity on ecosystem functioning, and how quickly the ecosystems will recover will all be addressed. The plan is to use this information to aid development of recommendations for best practice in the mining industry. A key component is the involvement of industry within the project and through stakeholder engagements to find feasible solutions. The project will work closely with European and international regulatory organisations to take these recommendations forward into legislation. A major element of MIDAS will be to develop methods and technologies for 1) preparing baseline assessments of biodiversity, and 2) monitoring activities remotely in the deep sea during and after exploitation, including ecosystem recovery. To carry out this work MIDAS is conducting a number of research cruises to examine the above issues at potential sites for exploitation of SMS and nodule deposits. This talk will present some of the recent findings of the project.

Sep 1, 2014

By Rubén Pavón] [H.

Mexico, that for various years held the second place among the elemental sulphur producers in the world, now occupies the fourth position. Nevertheless, taking advantage of the recent increase in the international prices of the metalloid, it is expected that Mexico recovers its traditional position producing, for the first time, over two million tons of sulphur during 1974. Drawing from material stockpiled during the last years sales are expected to reach 2.5 million tons, at excellent prices in the foreign markets, but not so in the domestic ones where prices have remained practically static since 1955, in spite of substantial escalation of production costs. Of the two sources of elemental sulphur in Mexico, the frasch process extraction from the salt domes of the Tehuantepec isthmus where the most important reserves are located - is the one that shall have an important increment. An increase of production of lesser magnitude is expected from sour gas, since sulphur recovery plants wilI go on stream toward the end of the year in the new oil fields recently located in the State of Chiapas. Two Mexican corporations are expanding and improving rational Frasch extraction operations. Together with Petroleos Mexicanos' sulphur recovery from sour gas it is estimated that production during 1975 shall reach 2.5 million tons and, consequently, supply the domestic market and generate an important sum of foreign currencies.

Jan 1, 1974

By C. A. Young, R. G. Robins, E. J. Dahlgren

The formation of copper thio-complexes in sulfide solutions has been recognized for many years and the measured solubilities of certain copper sulfide minerals attributed to these complexes. Attempts to model this system have proposed either copper(I) or copper(II) thio-complexes, and these have been incorporated into computer programs for generating stability diagrams for the copper-sulfur-water system in order to delineate the region where the reductive dissolution of copper sulfide minerals is likely. In this paper it is proposed that the dissolution of copper from both ore bodies and sulfide tailings can be explained by the formation of the cupro-thio-complexes under anaerobic conditions. Stability diagrams are presented to depict the region and extent of the solubility.

Jan 1, 2001

By H. A. Taylor

Graphite is elemental carbon that crystallizes in the hexagonal system as six-sided platelets. It occurs naturally and is mined. And it can be made artificially from petroleum coke in the form of shapes (electrodes) and powders. The market for most kinds of graphite in most end-uses was good in 2004. The 2005 graphite market looks positive. The major graphite prices, as given in Industrial Minerals, remained unchanged throughout the year. The preliminary 2004 U.S. Geological Survey (USGS) prices for natural graphite showed almost no change for crystalline flake. They were $600/t ($544/st) in 2004 and$622/t ($564/st) in 2003. Mexican amorphous graphite was almost unchanged at $150/t ($136/st) in 2004 from$152/t ($138/st) in 2003.

Jan 1, 2005

By M. J. Gregory

The Pebble Cu-Au-Mo deposit in southwest Alaska is one of the world's largest porphyry deposits. The western part of the deposit was discovered by Cominco America in 1987, who sold the project to Northern Dynasty Minerals Ltd., in 2001. Northern Dynasty discovered the high-grade eastern part of the deposit in 2004 and went into a 50:50 partnership with Anglo American PLC in 2007, forming the Pebble Limited Partnership (Lang et al., 2008). The Pebble Limited Partnership has continued to delineate the deposit through diamond drilling with the most recent resource estimate released in February 2010 (Pebble Limited Partnership, 2010). The Pebble deposit mineral resources comprise 5.94 billion tonnes of measured and indicated resources grading 0.78% Cu EQ, containing 55 billion pounds of copper, 67 million ounces of gold and 3.3 billion pounds of molybdenum. Also delineated are 4.84 billion tonnes of inferred mineral resources grading 0.53% Cu EQ, containing 25.6 billion pounds of copper, 40.4 million ounces of gold and 2.3 billion pounds of molybdenum (Pebble Limited Partnership, 2010). Resources are calculated using a 0.3% Cu EQ cutoff. GEOLOGY AND MINERALIZATION Deposit Geology The Pebble deposit is located in the Kahiltna terrane, between terminal strands of the north-east-striking Lake Clarke strike-slip fault. This fault represents an accretionary boundary and separates the Kahiltna terrane to the north-west from the Peninsular terrane to the south-east (Lang et al., 2008). The Pebble deposit represents a large magmatic-hydrothermal system centered on a group of 90 million year old porphyritic hornblende granodiorite intrusions. An east-west cross section through the southern part of the deposit (Figure 1A) shows the typical relationships between the various rock units which host sulfide mineralization. Sub-parallel ~96 million year old granodiorite and diorite sills were intruded into siltstones of the Jura-Cretaceous Kahiltna flysch. In the west, these sills were cut by a ~96 million year old alkalic intrusive complex composed of porphyritic monzonites and monzodiorites and related intrusion breccias (Bouley et al, 1995). The mineralized 90 million year old hornblende granodiorite intrusions cut all rock types and comprise four small stocks in the western part of the deposit and a larger pluton in the eastern part of the deposit. Recent deep drilling indicates that these intrusions coalesce at depth. The strongest porphyry-style mineralization is centered on the eastern granodiorite pluton and extends into the surrounding rock units (Figure 1A). The western half of the deposit crops out at surface, whereas the eastern side is un-conformably overlain by a cover sequence of Late Cretaceous to Eocene sedimentary and volcanic strata. The deposit was tilted 20º to the east during the Eocene.

Jan 1, 2012

By Simon D. Strauss

This article is part of a presentation Strauss made Dec. 3, 1988 at the sixth annual American Mining Hall of Fame (AMHofF) banquet in Tucson, AZ. At the banquet, the Mining Club of the Southwest honored Strauss by naming him the 1988 recipient to the AMHofF. (Industry newswatch, page 6). Introduction In the last two decades, there have been two previous periods of sharply rising copper prices. One was in 1973-74; the other in 1979-80. In both cases, a short period of high copper prices was followed by steep and prolonged periods of low prices. In the language of the market analyst, the high prices were called spikes. Is it likely, then, that three or four years from now the present price of copper will show up as a spike in the charts? There are substantial differences between the current position and the markets of 1973-74 and 1979-80. In 1973-74, US copper prices were subject to government-imposed price ceilings of $0.60 per lb through early December, 1973. These were increased to $0.68 per lb through May, 1974. Meanwhile, mines outside the United States were free of restraint. Rising demand in London pushed the price above $1 per lb in the third quarter of 1973. In early April 1974, it reached a peak of $1.50 a lb. In May of that year, the US ceilings were removed and the domestic price began to rise. What were the causes of this price strength? While ceilings held the domestic price below the world market, domestic consumers acquired all the tonnage offered by US mines. Meanwhile, in the world market, buyers feared prolonged shortages. The Club of Rome had warned that world economic growth would be limited by impending depletion of mineral resources. There was al so concern about a copper cartel that might increase copper prices even more. In early 1974, at a special United Nations session, developing-country spokesmen warned the industrialized world to expect high commodity prices. Also adding to the concerns of copper buyers was the fear that when US wage contracts expired in mid-1974, protracted strikes might ensue. The combined effect of this atmosphere was that consumers accumulated large amounts of copper, far above their normal carry. By midsummer, the position changed radically. While some strikes did occur in the United States, they proved short-lived. The most significant development was a massive economic recession. The energy crisis was causing enormous dislocations in the world economy. Construction activities were sharply reduced and automobile sales plummeted. Public confidence was shaken. Copper sales fell precipitately as consumers decided to draw down their swollen inventories. The price came down too. In April 1974, the London price- as noted-was $1.50 per lb. By the end of the year, it was down to $0.57 per lb. In 1973-74, the copper price rise was fed by fears of shortages, cartels, and strikes. In 1979-80, the market rose on the strength of good demand plus political and military instability. The price rise was also fed by inflationary trends, exemplified by speculation in precious metals. Prior to this second spike in copper prices, the market had been depressed despite economic recovery. Despite reduced US output, copper production in the rest of the world was increasing. Though consumption was rising, surplus stocks reached unprecedented levels. At the end of 1977, the aggregate of stocks at the refineries and in the exchange warehouses was 1.5 Mt (1.67 million st). That was more than three months' shipments at then rates of consumption. In 1978, the statistical position improved. Shipments of refined copper that year were 8% greater than in 1977. The result was reduced visible stocks but -just as was to be the case in 1984-86 - the price remained depressed. In 1979, an even sharper drop in visible stocks occurred as shipments rose by another 4%. This time, though, the price responded. In December 1978, the price in current dollars had been less than $0.70 per lb. By the end of 1979, it was above $1 per lb. And in the first quarter of 1980, it averaged more than $1.20 per lb. Military and political developments were a factor. The hostage crisis in Iran was followed by the Soviet invasion of Afghanistan. To many, it appeared that war might result if the Soviets pushed on into Pakistan. At the same time, speculation drove gold and silver prices to incredible levels. As silver prices rose above $40 per oz), copper above $1 per lb did not seem unreasonable. Then, in March 1980, the precious metals price boom collapsed. Copper prices also retreated, though not as much. In February 1980, the copperprice averaged $1.32 per lb. By December, it had dropped to $0.85 per lb. In 1981 and 1982, the decline continued. The present copper situation Why is the current situation different from these two previous episodes of high prices? First of all, today's inventories are far lower than they were in either 1974 or 1980, when the price declines began. The stocks at refineries and in exchange warehouses are substantially less than they were then. More significantly, consumers today have very limited holdings compared with stocks they carried in 1974 and 1980. Even if faced with a downturn in their own business, copper consumers will not be able to stay out of the market. To the extent they have any business at all, they will have to buy copper. And on the supply side, there is also a significant difference. The year 1988 has been unusual. US production is up sharply, responding to higher prices. But production is little changed in the rest of the Free World. Indeed, several of the major producing countries have mined less copper this year than in 1987 despite the prices increases. Peru has had labor problems that have cut its output. Zambia and Zaire suffer from shortages of expatriate technicians, not to mention spare parts. They also suffer from the failure to maintain equipment or perform adequate development. In Chile, the two largest mines, Chuquicamata and El Teniente, have not met their production targets. Chuquicamata is struggling with high arsenic content in its ore. And, in late 1987, severe rockbursts hampered operations at El Teniente. In addition, depletion of some mines in Australia and South Africa has offset rising output at other properties. Indeed, when final mine output figures for 1988 become available, it may well be

Jan 1, 1989