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Strategies & Market Trends : Ride the Tiger with CD -- Ignore unavailable to you. Want to Upgrade?

To: robnhood who wrote (176518)	10/7/2009 8:01:08 AM
From: Condor	1 Recommendation Respond to of 312411

A few years is a long time when it comes to markets. While that is correct for the most part, consider that many mines are able to move into the "shelved" areas of their ore bodies that were previosly of marginal grades. A mine with 30,000,000 tons of ore can suddenly find itself with 60,000,000 tonnes of ore. Ore is ore if it is economical to mine. Anything else is waste. Waste can suddenly become ore on price rises. So, to an extent, supply can be ramped up rather quickly. The question is can it be ramped up enough to sufficiently meet the surge in immediate demand? Long term production can rise substantially. In our mines, when prices sagged, we just closed (shelved) headings that were lower grade and high graded other headings to stay economical. Anyhow, I don't have the categorical answer to the situation of supply but the preceeding can't be totally ignored. It's another factor in our understanding of mining supply and demand.