The Mining industry covers establishments primarily engaged in the extraction of minerals, coals, and ores from the earth. Industry operations include quarrying, digging, and related support operations such as milling, crushing, washing, and screening. The mining industry also covers the exploration for and development of mineral properties and services performed in the development and operation of mineral properties. The Metals Sector

The mining industry provides ores and raw metals to mills and metal fabricators. The pricing for metals varies with demand, which is determined by a broad range of industrial and economic factors. Demand is currently down, forcing metal prices down and cutting into mining industry profits.

Before the recent economic downturn, commodity prices had been trending upwards for several years. The prices for a number of metals had skyrocketed, with zinc doubling in value and the price of copper increasing even more. Since the downturn, however, global demand for commodities has plummeted. The faltering world economy has stifled the demand for raw materials, including metals.

It was hoped that even if demand fell, rising consumption in China, India, and other developing countries would continue to generate demand, but this isn't proving to be the case. Demand for metals is slowing even in China, the world's biggest buyer of base metals including copper, aluminum, and nickel.

Mining industry giant BHP Billiton Ltd. cited the fall in commodities prices as one of the reasons it abandoned its y ear- long attempt to acquire rival Rio Tinto, stating that the $66 billion deal was too risky at a time when the slowing global economy reduced demand for raw materials. The transaction was worth as much as $194 billion in May 2008 before metals prices slumped.

before the economic crash, the metals sector suf fered from decreased demand from the North American housing construction and automotive industries. Demand from these industries, which rely on aluminum, cooper, and other metals, is not likely to recover any time soon. The automotive and construction sectors account for roughly half of US copper consumption.

In response to falling demand, many companies in the industry have taken cost cutting measures such as reducing production or laying off employees. Even companies that are currently profitable are being cautious. Southern Copper Corporation, for example, has stated that prices would need to fall by a further 46 percent for the company's mines to lose money. Even so, the company announced that it will suspend any further spending on its El Arco mine in Mexico and it may delay projects where it has not yet begun exploration.