Basic Materials Sector by Better Trades

The Basic Materials sector is compiled by companies involved in the extraction and primary refinement of chemicals, metals, nonmetallic and construction materials, forest, wood and paper products, and containers and packaging products.

The sector is made up of 9 overall subsections that include Mining & Metals, Steel, Chemicals – Agriculture, Chemicals – Diversified, Chemicals – Commodity, Precious Metals & Minerals, Paper Products, Construction Materials, Aluminum and Forest & Wood Products.

In an industry that is comprised of 58 companies with a market capitalization of nearly $107B, the Mining & Metals sector is engaged in the mining, beneficiation and processing of non-ferrous metals, such as copper, zinc, lead, tin, nickel, cobalt, graphite, titanium and other non-ferrous metals for the manufacturing of foils, pipes, tubes, rods, sheets, plates, powders and wires. The Mining & Metals sector also produces specialty items in an industry that excludes steel, aluminum, precious metals & minerals, coal, and potash mining.

The Steel industry, which is made up of 45 companies with a market cap of nearly $40B, is engrossed in the extraction of iron ore and coke coal beneficiation for the processing of iron and steel. The industry includes metal ore exploration and mining services, iron and steel foundries for smelting, rolling, forging, spinning, recycling, stamping, polishing and plating of iron and steel products. These products most often include pipes, tubes, wire, spring, rolls and bars.

Moreover, the Agricultural division of the Chemicals industry is a group of 22 companies involved in the production of potash, soda ash, peat humus beneficiating, nitrogenous, phosphatic and ammonia-based fertilizers and minerals, insecticides, fungicides, weed and rodent poisons, agricultural salts and other related products. This sector is currently valued at $26B.

Another portion of the Chemicals industry, the Diversified sector, consists of six companies significantly engaged in at least two the following industries: Chemicals - Commodity, Chemicals - Agricultural and Chemicals - Specialty. This sector includes such companies as Ashland Inc. (ASH), DuPont (DD), LSB Industries Inc. (LXU), Minerals Technologies Inc. (MTX), Nanophase Technologies Corp. (NANX), and Dow Chemicals Co. (DOW) with a total market cap of $16B.

The Commodity portion of the Chemicals industry is made up of 73 companies involved in the processing and refinement of industrial chemicals and gases, petrochemicals, liquid hydrocarbons, vinyl, casein and other plastic resin materials, stains, paints, tanning and softening agents, explosives and other chemicals. This portion of the industry has a market cap of $11.5B.

Further into the Basic Materials sector is the Precious Metals & Minerals industry, which is a list of 197 companies employed in the extraction and processing of gold, silver, platinum, diamond, gemstone, semiprecious stones, uranium, pearl cultivation, and other rare earth minerals and ores. PM&M currently has a market cap of $20B.

The Paper Products sector consists of 20 companies with a market of more than $11B and is engaged in an industry that relates to pulp mill and paper manufacturing operations. The industry includes loose-leaf, computer, construction and stationary paper, bond, book, and newsprint, as well as paper towels, napkins, toilet paper, sanitary napkins and disposable diapers.

In addition, The Construction Materials industry involves 22 companies engrossed in the mining, quarrying and processing of raw materials engaged in road and building construction. The industry includes the extraction of sand, gravel, rock, clay, gneiss, granite, limestone, marble, slate, gypsum, lime, cement, concrete and bricks, as well as filtering, bleaching, crushing, cutting, sizing and other stone-processing operations. The Construction Materials sector is valued at $7.3B.

The Aluminum industry pertains to eight companies, comprised of Alcoa Inc. (AA), Alumina Ltd. (AWC), Aluminum Corp. of China Ltd. (ACH), Century Aluminum Co. (CENX), Kaiser Aluminum Co. (KALU), Liquidmetal Technologies Inc. (LQMT), and Norsk Hydro ASA (NHYDY) made up of an industry that is valued at $6.4B. These companies are experienced in the mining and beneficiation of bauxite and the smelting, refining, and processing of alumina and aluminum alloys. The practice within the industry also includes the recycling of aluminum, foundries, die-casting and production of foil, molds, plate, tube, sheet, rods, pipe, wire and other aluminum products.

The last division within Basic Materials is the Forest & Wood Products industry, which relates to 11 companies involved in operating timber tracks, nurseries, seeding, reforestation, and harvesting timber and other forest products. The industry also includes related services, such as cutting, logging, transporting, estimating and other forest management services. Products include lumber, plywood, flake board, chips, sawdust, wood flooring, shingles, tiles, millwork, laminated veneer, fencing and other primary wood products. These companies are currently valued at $4.5B in market cap.

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