Basic materials sector
The basic materials sector is made up of companies that find, extract, and process : metals and mining companies, chemical producers, and makers of construction materials, paper, and packaging. Their products are the inputs other industries use to make .
Most of what these companies sell are commodities, products that are largely the same no matter who makes them, so they have little control over the prices they receive. Profits rise and fall with commodity prices and with demand from manufacturing and construction, which makes the strongly .
The businesses are also . Mines, smelters, and chemical plants cost a great deal to build and take years to bring online, which often leads to cycles where high prices encourage new capacity that arrives just as demand cools, pushing prices back down. Low and a strong are usually what let a company in this come through a downturn in good shape.