Comprehensive Overview of Basic Knowledge in the Metal Industry: Classification, Supply Chain and Market Influencing Factors

I. Classification of Metals
(1) Ferrous Metals
Ferrous metals mainly refer to iron, chromium, manganese and their alloys. Among them, steel is the most common and widely used. Steel, with its high strength and low cost, has become a key support for building infrastructure such as skyscrapers and bridges in the construction industry; it is also the basic material for manufacturing various mechanical equipment and components in the machinery manufacturing industry; and it is used to build sturdy and durable hull structures in the shipbuilding industry.
(2) Non-ferrous Metals
Non-ferrous metals include many other metals besides ferrous metals. They have a wide variety of types. For example, copper has excellent electrical conductivity and thermal conductivity. In the electrical field, the manufacturing of wires and cables cannot be done without copper; in the electronics industry, electronic components such as circuit boards and chips also use copper extensively. Aluminum, due to its low density, corrosion resistance, and easy processing, is an ideal material for manufacturing aircraft bodies and components in the aerospace industry, effectively reducing the weight of aircraft and improving performance; in the automotive manufacturing industry, it is used to produce automotive engines, body frames, etc., helping to achieve lightweighting and reducing energy consumption. Zinc, due to its strong corrosion resistance, is often used in galvanized steel plates to prevent steel from rusting and extend the service life, and is also widely used in the die-casting of components in hardware and household appliances.
(3) Precious Metals
Gold, silver, platinum, etc., not only have excellent physical and chemical properties, such as extremely high chemical stability and excellent ductility, but also due to their rarity, have special uses in currency reserves, jewelry making, and high-end fields such as electronics and chemicals. In the electronics industry, gold is often used for the surface coating of electronic components to ensure stable transmission of electronic signals; silver plays an important role in photography and batteries.
(4) Rare Metals
Rare metals such as tungsten, molybdenum, cobalt, lithium, etc., have unique physical and chemical properties and are key strategic materials in high-tech industries and defense and military industries. The high melting point of tungsten makes it an excellent choice for manufacturing cutting tools and filaments; cobalt and lithium are important components of modern lithium batteries, and with the rapid development of the new energy vehicle industry, the demand has increased sharply.
II. Metal Industry Chain Structure
(1) Upstream Mining
Mining exploration: Utilizing geological exploration techniques, such as geological mapping, geophysical exploration, and geochemical exploration, to discover the distribution, reserves, and quality of underground metal mineral resources, providing a basis for subsequent mining.
Mineral extraction: Depending on the type of deposit and its occurrence conditions, using open-pit mining, underground mining, or marine mining methods. Open-pit mining is suitable for shallowly buried ore bodies, where the overburden and waste rock are removed to extract the ore; underground mining is for deep-buried ore bodies, where mines and tunnels are excavated for mining; marine mining is extracting metal ores on the ocean floor, which is technologically challenging and costly.
(2) Midstream Smelting and Processing
Smelting
Pyrometallurgy: Utilizing high-temperature reduction reactions to extract metals from ores, including roasting, smelting, blowing, and refining, which are commonly used for the smelting of iron, copper, lead, etc.
Hydrometallurgy: Utilizing solvents to dissolve metals in ores and then through chemical reactions or electrolysis to extract, suitable for some low-grade and complex ores, such as extracting copper from copper ores.
Electrochemical smelting: Obtaining metals through electrolytic reactions from ores or solutions, like electrolyzing aluminum, which is dissolving aluminum oxide in cryolite molten salt to obtain aluminum.
Processing
Pressure processing: Including forging, stamping, and extrusion. Forging uses forging machinery to apply pressure to metal billets to cause plastic deformation, manufacturing high-strength parts such as gears and shafts; stamping is used to produce thin sheet parts, such as automotive body panels; extrusion can produce various profiles and pipes.
Cutting processing: Using cutting tools such as turning, milling, and grinding to remove excess material from the metal billet to achieve the desired shape and accuracy, widely used in mechanical part manufacturing. Surface treatment: To enhance the performance of metal surfaces, processes such as painting and electroplating are carried out. Painting involves coating the metal surface with paint or coatings, which serves the purposes of corrosion prevention and aesthetics; electroplating utilizes the principle of electrolysis to deposit a layer of metal or alloy on the metal surface, enhancing corrosion resistance and wear resistance.
(III) Downstream Applications
Metal products are widely used in various fields such as construction, transportation, electronics, and energy. In the construction industry, metal materials are used in building structures, doors and windows, pipes, etc.; in the transportation sector, automobiles, high-speed trains, aircraft, etc., cannot do without metals; in the electronics industry, metals are the main materials for electronic components, circuit boards, casings, etc.; in the energy sector, metals play a key role in wind power generation, solar photovoltaic, battery manufacturing, etc.
III. Market Influencing Factors in the Metal Industry
(1) Macroeconomic Situation
The global economic growth trend has a significant impact on metal demand. During economic prosperity, infrastructure construction and manufacturing expansion drive up metal demand; during economic downturns, investment decreases, and metal demand weakens. For example, the rapid development of emerging economies, large-scale urbanization and industrialization processes have greatly stimulated the demand for steel, cement and other metal-related products.
(2) Policies and Regulations
Environmental protection policies: Increasingly strict environmental requirements prompt metal enterprises to increase investment in energy conservation and pollution control. For example, in the metal smelting process, the standards for emissions, wastewater and waste residue are raised, and enterprises need to improve production processes and purchase environmental protection equipment; otherwise, they will face production restrictions or suspensions.
Industrial policies: The government introduces industrial policies to guide the optimization and upgrading of the metal industry. Encouraging the development of high-end metal material manufacturing and promoting the integration and reorganization of the non-ferrous metal industry to enhance industry concentration and competitiveness.
Trade policies: Changes in international trade policies affect metal import and export trade. Tariff adjustments and the establishment of trade barriers will change the international market prices and circulation patterns of metal products, affecting the international market share and profit margins of enterprises.
(3) Technological Innovation
The emergence of new technologies brings changes to the metal industry. In material research and development, new metal materials are constantly emerging, such as high-strength, lightweight alloy materials, meeting high-end demands in aerospace, automotive lightweighting, etc.; in the production and manufacturing process, intelligent manufacturing and digital technology applications enhance production efficiency, reduce costs, and improve product quality. For example, 3D printing technology's application in the processing of metal materials has opened up new ways for the manufacturing of personalized, complex-structured parts.
(4) Resource Distribution and Supply
Global metal resources are unevenly distributed, mainly concentrated in a few countries and regions. For instance, iron ore is mainly exported by Australia and Brazil; copper resources are abundant in countries such as Chile and Peru. Political situations, mining policies, and natural disasters in resource-supplying countries will affect the stability of metal raw material supply and price fluctuations.