The mining and metal industry is made up of six categories: aluminum, gold, precious metals, other metal extraction, coal mining and steel. Steel (and iron) is the biggest segment, as it makes up more than half the market in terms of volume, followed by aluminum in terms of the global metal market which is focused more in the Asia-Pacific region, followed by Europe.
The metal extracted is used in industries such as automobiles and consumer durables, in particular computers which require aluminum, steel and precious metals. Therefore the market remains strong even in economic decline as demand stays high.
Porters 5 Forces Model
Michael Porter provided a framework that models an industry as being influenced by 5 forces. The model enables managers to understand the industry context in which a firm operates. The forces that the model is based on are: Rivalry
Threat of entry
Each of the above will be discussed in detail.
There is a certain degree of rivalry among firms operating in the same industry. The degree of rivalry, however, depends on various factors. Some of these factors are industry growth, diversity of rivals and industry concentration. Competitive rivalry is actually very strong...