Problems of Forecasting Metal Prices

There are serious problems in forecast- ing accurately and achieving this goal depends on good quality information, correct assumpt- ions and sound analysis. planner. The forecaster must focus attention on a number of key areas of interest. These areas include major economic trends and changing GNP structure, consumption time series, end-use consumption patterns and substitution potential, accurately updating data bases (up to 5 years ahead), random factor estimation and examination of both long term and secondary mine potential. While metal price forecasting has suffered due to recent uncertainties, with increased importance on planning tools and cost analyses, it is still a necessary function. Forecasting is subject to the real world and the metal industry is made up of imperfect markets in a dynamic state. The real world provides the challenge to improve the accuracy of forecasting.