So the pick-up in base metals prices over the past two weeks is a matter to be welcomed.

Leading the way as usual is copper, one of the most widely used metals in industry after iron.

Huge US copper producer Phelps Dodge timed its bid for Asarco excellently a couple of months ago.

However, Phelps Dodge did have to cut smelting capacity, unlike the South American firm - whose labour is cheaper.

Lean period

This has emerged too in other metals.

One of the hardest hit by the recession in metals prices has been zinc.

It is an "old industry" metal, used heavily by car manufacturers to galvanise steel - a downturn in the car industry, and growing displacement of iron based materials by composites and plastics, just adds to the problems of miners such as Breakwater of North America.

This zinc producer has secured extra bank funding until next year in the hope that prices will continue to rise.

But Pasminco in Australia has had to go to the receivers.

It has not been helped by forecasts of increased output from Peru's (low cost) Antamina zinc mine.

Price rebounds

However look on the bright side.

Since November 1, the copper price has risen by more than 10%, aluminium is up by 9.3%, the price of nickel, essential in steel manufacture, is up by a whopping 21.2%, and even zinc is up almost 7%.

Tin prices are up by 5.5%. But demand for the most malleable of all metals, lead, is still pretty subdued - lead prices have gained only 3.2% since the start of the month.

Lead supply relies heavily on recycling, not an expensive process, so even this small gain in price should stimulate output.

This will all be very welcome news among governments and treasuries anxious about the state of the global economy. It's all evidence of a probable economic recovery in 2002.

(Rodney Smith is a small shareholder in Breakwater Resources)