Following two successive years of strong growth, the overall index of prices for metals and minerals in 1989 rose by 7 percent (Table 8). Increases in annual average prices were recorded for all of the commodities in this index except aluminum (Appendix Table 10). The higher annual averages, however, obscure the general downward trend over the course of the year (Chart 7). During the first quarter of 1989, the index increased by 9 percent over the final quarter of 1988, to a record high, mainly on the strength of advances in prices for nickel (by 31 percent) and zinc (23 percent). Prices began to slide in the second quarter, however, and the index fell by about 18 percent between the first and the final quarter of the year. The downward trend in 1989 would have been more pronounced had it not been for a temporary surge in the price of tin in the second quarter and sustained price increases for iron ore and lead, which continued through the first quarter of 1990.

Market Developments and Outlook