These Rare Commodities Might Be Gone Soon
In about 20 years, a few rare commodities could be gone. According to Goldman Sachs there is only enough gold, diamond, and zinc left for the next two decades. Platinum, copper, and nickel, might last us a little longer in the investment bank’s view: 40 years or less.
The combination of very low concentrations of metals in the earth’s crust and the very low quality of the deposits are making that some commodities are becoming really rare, Goldman Sachs’ metal analyst explains. Gold has been used for over 4000 years as a measure of wealth, after the Egyptians found out that it is not just shiny, but also very rare.
Rare Commodities
The result of the relative scarcity of different commodities on our planet and the belief of the market that new discoveries will be limited, is that the prices of these super rare commodities will go up.
Despite the fact that gold is only getting more scarce, production of gold could reach a new peak this year. A slide from Goldcorp (GG) of last year showed a prediction for the gold mining industry for 2015. Based on a lot of analysis, the point was that the mining industry would peak this year.
Peak Gold
A peak for gold is not a strange idea in the eyes of Peter Grant, precious metals analyst at USAGold. He explains that mining output has been stable for years and new gold discoveries have not only been limited, but also significantly decreasing in numbers. The analyst expects that a peak will happen for the gold market in the short term, which he expects to support the gold price for years to come.
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The slow down in production has more to do with the low gold price that we are supposedly running out of gold. Gold prices have been falling for the last three years.
I thought this kind of scaremongering was dead and buried! The mining industry will continue to supply as demand increases and the real terms price of the commodity rises. There is sufficient nickel to supply the world for hundreds of years, natural diamonds for less. Gold is not rare, it is common but not often concentrated in amounts that are currently economic. It certainly is more commonly concentrated in amounts that would be economic with higher pricing. Copper is common and again, the Goldman Sachs analyst must have been speaking only of current resources and reserves, not the modeled resource base that has been very carefully constructed in many countries by organisations such as the United States Geological Survey and by Geoscience Australia. These organisations do this work to have the information available on potential for and locations of undiscovered resources. The same kinds of work is done fpr many other commodities including oil. Time for better quality and in depth research before sensational headline grabbing comments are published.