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Katchum
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Albert Sung is the author of Correlation Economics, monitoring breaking economic news on a day to day basis. He started investing in 2008 because of the economic crisis and holds a masters degree in chemical engineering. Previously, he worked several years as a process engineer at Ashland, a... More
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Correlation Economics
  • Capacity Utilization Rate At 78.3% In September 2012 0 comments
    Oct 16, 2012 1:38 PM | about stocks: GLD

    For all those who are concerned that precious metals will go down for the rest of this year, there is some light at the end of the tunnel.

    Capacity utilization rate for the total industry was up to 78.3% in September 2012 from 78% in August 2012. In particular, the mining industry recovered well, from 88.4% in August to 89.1% in September.

    While looking at these numbers, I don't see precious metals crashing just yet.

    (click to enlarge)

    Table 1: Capacity Utilization Rate

    (click to enlarge)

    Chart 1: Capacity Utilization Rate

    This statement can be confirmed if we look at the resource producing countries of Canada, Russia and Brazil.

    (click to enlarge)
    Chart 2: Brazil Capacity Utilization
    (click to enlarge)
    Chart 3: Russia Capacity Utilization
    (click to enlarge)
    Chart 4: Canada Capacity Utilization

    The only country that isn't doing as well is Australia, where the capacity utilization rate declined over the entire year.

    (click to enlarge)
    Chart 5: Australia Capacity Utilization

    The probable reason for Australia's declining capacity utilization rate is a slowdown in China, which can also be seen in their capacity utilization rate, which is at a record low of 60% according to the IMF.

    (click to enlarge)
    Chart 6: China Capacity Utilization Rate

    Disclosure: I am long GLD.

    Stocks: GLD
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