US metal output slips

Many indicators reflect a rebounding U.S. economy: rising consumer confidence, higher retail sales, greater industrial production, and more new home starts. Yet production from metal and industrial mineral mines in 2003 was down slightly, compared with 2002.

The estimated total value of U.S. raw non-fuel mineral mine production alone was about US$38 billion, a little less than in 2002. Metals accounted for about 22% of the total value, and industrial minerals, 78%.

The estimated value of all mineral-based products manufactured in the U.S. during 2003 was US$370 billion, a small increase of 1% over the previous year.

The U.S. has become increasingly reliant on foreign sources for raw and processed mineral materials. Imports of raw and processed mineral materials increased 3% from 2002 to US$64 billion. As in recent years, aluminum, copper, and steel were among the highest-value imports.

Exports of raw and processed mineral materials in 2003 rose about 10% to US$42 billion.

The construction industry led the demand for both metals and industrial minerals. The value of new highway construction increased by almost 2% to US$61 billion, and housing starts increased by 7% to more than 1.8 million units, a trend supported by continued low mortgage rates.

Metal mining continued to be depressed in the U.S. Curtailments at copper mines persisted, and production of copper semi-fabricated products declined.

Global copper prices remained low during the first three quarters of the year but rallied sharply in the last quarter to 6-year highs in response to strong demand in Asia, especially China. Global consumption growth in 2004 is expected to be driven by continued strong Chinese demand.

Despite the slight increase in aluminum production, most primary metal smelters in the northwestern U.S. remained idle last year, owing to low prices and high energy costs. The 3% increase in aluminum consumption was essentially met by imported aluminum metal.

At the end of 2003, most economists were describing the domestic economic recovery as robust but noted that the creation of new jobs, particularly in the manufacturing sector during the first three quarters, was still lagging. The U.S. mining and mineral processing industries continued to lose jobs while productivity continued to improve. Aggressive research into reducing production costs, and into fining new uses for byproducts and primary mineral products, will be required to reinvigorate the U.S. mineral industries.