When you think about supply and demand, the equation works terrific with commodity prices. The price of commodities are linked to the demand – the world economy slowdown which sent commodity prices down. David Stringer writing for Bloomberg News recently wrote the $ 149 billion pipeline to expand the world’s copper supply is running into trouble.

Trouble means there is an opportunity, for if supply does not go up and demand continues prices will rise. If prices rise, there are profits to be made, but not quite yet. In the world of copper mining, the mines are large and need banks to finance them (many world banks are not saying yes right now); the countries where the copper is to be found often goes through a variety of government administrations; technical obstacles get in the way and for some projects there is a lack of water and electricity to mine the copper.

In 2011 copper was trading on the London Metal Exchange at $10, 190 a ton; in January 2016 the price touched a low of $4,318 a ton. This year the price has increased to $4,600 or the price has been essentially flat. The largest companies Freeport-McMoRan, Codelco and BHP Billiton see a shortage from 2019. This year capital spending on copper related mines will be $41 billion down from $104 in 2013. As the price starts to rise the financing will rise to.

Linking to dividend paying stocks, the global miners own mines which they can produce copper at less than $4,000 a ton so they are not going out of business, they just slow down and try to revamp their mining practices. As the prices rise, the margins get larger and the banks which finance them have more breathing room so they will give the money. It is good to have on your list of companies to watch commodity companies because as the price goes up for them, the ripple effect in the economy means the world economy is doing better or more demand. If you follow the companies, as the price begin to rise, you can buy the best of the breed and make some easy money as the price of commodity rises and pays you a dividend along the way.

There are more questions than answers, till the next time – to raising questions.