duction of steel. Fig. 5 shows that domestic production rose from 97 million tons in 1950 to 120 million tons in 1971. More importantly, 1971 domestic tonnages represent only 19 percent of world steel production. compared to 47 percent 20 years ago. Fig. 6 explains further the increasingly significant role of imported materials as a contributor to domestic iron supplies, and the relatively flat trending iron ore production picture in the United States in

Of the ferroalloy materials manganese, molybdenum, vanadium, tungsten, silicon, nickel, cobalt, columbium and tantalum the United States is now self-sufficient only in molybdenum silicon and tungsten and therefore imports most of its manganese, chromium, cobalt and nickel, as well as large percentages of the other ferroalloy elements.

Growth in nonferrous metals

In terms of tonnage produced, the major nonferrous metals are aluminum, copper, zinc and lead. Fig. 7 shows that use of aluminum has more than tripled since 1950, while usage of the other three metals has changed relatively little during the

An examination of production trends (fig. 7) indicates that the fast rising demand for aluminum metal has been met by increasing imports of bauxite (the ore of aluminum) and alumina. Approximately 90 percent of aluminum production is based upon imported material.

As for copper, U. S. mine produc-tion currently is about two-thirds greater than it was in 1950. Recycled scrap has throughout this period contributed substantially to the supply while net imports have decreased and currently represent less than one-tenth of total copper demand (fig. 7).

Fig. 7 also displays the fact that domestic mine production of zinc has been exceeded by net imports in 16 of the past 21 years. Output was at a comparatively steady rate for the 1960 decade after a slight decline in the 1950's

Recovery of old scrap has long been a substantial factor in the lead industry. In fact, recovery of scrap exceeded domestic mine production of lead every year in the period 1950

stockpile for use in national emergencies Imports of these in 1971 ranged from 100 percent of US demand for such metals as thorium and strontium, to 75 percent of platinum group metals, 64 percent of tin. 54 percent of antimony and so forth In all but a few, the United States must import a large share of its requirements

Nonmetallics output had $5.9 billion

value

Nonmetallic minerals represent a broad range of materials of vast importance to the economy, including construction materials, such as sand and gravel, clay, cement rock, gypsum, the fertilizer minerals, nitrogen. phosphorous and potassium. and such others as salt, corundum and garnet, sulfur, barium, calcium The nonmetallics proquartz. clc duced in the United States in 1971 had a value of $9 billion and for the most part fulfilled domestic requirements for these materials A notable exception was potash, which has for seven years been entering the country in increasing amounts

To summarize, this portion of the report illustrates a widening gap between domestic demand and production over the past 20 years It also makes clear the increasing dependence upon foreign sources for many primary minerals and fuels Exam ples of major mineral imports are shown in the table below

mineral industry concerns have yielded to more economically attractive foreign sources for minerals as well as for end-products fashioned frem minerals because of lower costs, higher grades of ores, and broad incentives to extraction." According to the report, the pitfalls of such reliance include. "Growing nationalism in some foreign areas shifting foreign ideologies... growth of the value-added' concept in foreign nations price and production controls through national coalitions

worldwide increases in demand harden raw material availabilities

and prices. shipping strikes compromising of national security Socio-economic and political

shifts

Having traced an historical upswing in major fuel and mineral imports, the report examines the question of whether domestic reserves and resources of minerals and fucis are sufficient enough to warrant expanded development, which could help check future rising imports. Despite near or total dependency upon foreign sources for some minerals, the report states that the resources of the United States generally are such that its position among the family of nations remains enviable. In some instances, we are reaching a state of inadequacy irrespective of how diligently we search for additional sources In other instances, such as major nonmetallics ard coal, domestic reserves are large

The report emphasizes that one of the stipulations in the Mining and Minerals Policy Act of 1970 calls for an appraisal, by the Secretary of the Interior, of the mineral industries' ability to meet future domestic mineral requirements. This was done by extrapolating to 1985 and 2000 the past 20-year trend of domestic primary production for each commodity by straight line projections (see page 60). Conceding that straight line projection may not be the best indicator, the report states that it gives a common unified base for all commodities, noting also that production histories over the past two decades for many minerals are relaLively linear.

The total mineral picture emerges in hg. 10, which stresses the magnitude of projected deficiencies in domestic mineral supply in relation

Percent

45

45

1970

COMEST

OF NAME ALLOY

64

• Domestic demand for petroleum and natural gas exceeds readily available domestic productive capacity. Reliance upon imports of petroleum and natural gas is increasing at alarming rates. Domestic petroleum demand in 1971 was one-fourth supplied by imports, natural gas imports continue to rise. According to the report, both industries need encouragement to develop reserves estimated to be adequate to supply demands to the year 2000.

The lag in development of domestic mineral resources, the report states, leads to increased dependency on imports and this gives rise to three interrelated problems, as follows:

• Expropriations, confiscations, and forced modifications of agreements in foreign countries already have severed the flow to the U.S. of some foreign materials produced by United States firms operating abroad and have made other materials more costly,

• United States industry is encountering far greater competition for foreign mineral supplies, and • Increasing dependence on foreign sources for important mineral supplies places increasing constraints upon the conduct of U. S. foreign policy and at the same time threatens stability of the U. S. economy.

• Investment in development of domestic mineral properties is falling behind. Commenting upon the uniqueness of mining compared to other types of enterprise, the report goes on to note that mine development in the U. S. today generally requires huge investments. Commonly, six or seven years pass between project inception and profitmaking production. Development of domestic mineral resources has fallen behind as investors have become increasingly cautious because of the many uncertainties arising from lack

of firm government policies. Examples include land use limitations, new environmental regulations, severance taxes, real estate taxes, and changes in tax laws covering exploration, development, depreciation and depletion. "Integrity both of the investment and tax bases during project life," the report says, "is an opportunity for federal, state and local governments to foster domestic investment." Suggestions were also made for added tax incentives “... to encourage exploration, maintenance of adequate, stable percentage depletion rates and accelerated tax amortization for costs of pollution abatement facilities." Furthermore, the report recommends study of environmental programs "for opportunities to establish better balance between the need for the improvement of our ecology and the need for minerals."

• Environmental regulations threaten major disruptions of some domestic mineral production. Major segments of the mining industry are threatened with large unanticipated costs resulting from environmental constraints. In fact, environmental regulations have already contributed to the shutdown of some domestic smelters and to reduced operations at others. Also, regulations dealing with sulfur emissions from power plants and steel mills have placed a premium on low sulfur coals. Another problem area has to do with efforts to eliminate or restrict surface mining activity.

The report observes that the need to lessen the impact on the environment by mining and mineral processing operations is recognized by both industry and government and stresses that difficulties in recovering costs involved must be resolved. With a balanced approach to the cost price squeeze, reasonable environmental controls and a viable mining industry will likely result.

Resources research within the Department, the report says, can contribute materially to the delineation of present problems and the advancement of feasible solutions. The report outlines specific opportunities having to do with restoration of mined land, tailings deposits and other dumps, cooperative efforts with the Department of Agriculture in developing land restoration tech

niques, and development of new uses of sulfur.

• Actual and prospective withdrawals of land available for prospecting and exploration may adversely affect domestic mineral development. At the same time that mineral needs are increasing, the amount of land available for prospecting and exploration is being reduced, it is contended. The report says that withdrawals of public lands for establishment of wilderness areas and parks without adequate knowledge of their mineralization is subject to criticism. National interest dictates a need to consider extraction of minerals in such areas.

• Domestic demand for many non-energy minerals has been cyclically lower in the past few years. At the same time, producers have experienced increased import com. petition. Sharp declines for durable goods in 1970 and 1971 caused lower domestic demand for steel, aluminum, lead and zinc. As a result, metal prices dropped, production was cut back, and profits were down. At the same time there was worldwide over-production of many minerals, forcing domestic producers to base their prices at world market price levels rather than a reasonable mark-up over U. S. production costs. Minerals processors and fabricators have the opportunity to develop new uses and thereby increase demand for their basic products. Maximum efficient use of materials would enhance product value to purchasers, the report contends. The report also suggests the possibility of legislation to deal with disruptions caused by buildups of imports by "establishing a system of temporary orderly marketing mech

anisms.

• Trend toward increased importation of processed materials of mineral origin increases balance-ofpayments problems and further reduces employment and investment opportunities in the domestic mining and mineral processing industries The U. S. is importing more steel. alumina, fuel oil and similar processed materials of mineral origin. Such materials have an adverse effect upon balance of payments, reduce employment possibilities within domestic industries and inhibit mining venture investments. The report