Wednesday, May 21, 2008

U.S. mineral production shows economic slowdown

The decline in U.S. mineral production of construction materials reflects drops in the domestic housing market. U.S. Geological Survey data shows "significant declines in domestic production for a number of construction materials, including cement, gypsum, construction sand and gravel, and crushed stone." For example gypsum production dropped 11% from 4th quarter 2007 to the first quarter of 2008 and declined 14% compared with that of the first quarter of 2007. [above: Western Mining & Minerals, gypsum for portland cement]

This is the first time the USGS has publicly released the same data provided to the Federal Reserve System's Board of Governors used to prepare its index of industrial production, a principal economic indicator.

According to the USGS, "This index measures the output of factories, mines, and electric and gas utilities. Output reflects changes in price and demand for mineral commodities used by industries such as construction, transportation equipment and agriculture. Output is an important early indicator of changes in economic activity in those industries."

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