Raw materials are necessary for industrial processes and can include minerals, organic material, crude oil, metals, and timber. Costs vary based on demand, scarcity, and ease of harvesting. Processing is required to make raw materials usable. Controlling supplies is essential to avoid interruptions in production. Trends in manufacturing can cause sudden spikes in demand and shortages.
Raw material is the raw material required for an industrial process. Examples can include minerals, organic material, crude oil, metals, and timber. Humans have been using raw materials of all kinds for centuries and new uses are constantly being developed all over the world. Costs vary as demand rises and falls; prices can go high when a particular product is badly needed and can go down when interest decreases.
Other factors affecting the cost of a raw material can include scarcity and ease of harvesting. Rare metals, needed as a basis for manufacturing electronics, tend to be difficult to obtain and are often very expensive. Commodities such as grains are generally easy to grow, harvest and transport, keeping prices relatively low. All of these costs are passed on to the final consumer and the prices of finished industrial products can fluctuate in response to changes in raw material prices.
The amount of processing required to make the raw material usable varies, and several steps may be involved. With something like iron ore, the ore must first be worked to remove impurities, and then it’s processed into ingots and rods for easy handling. These in turn can be smelted, bonded with other metals and manipulated in various ways to generate products made with iron. Manipulating the process can lead to products of different quality, with different strengths and weaknesses; raw materials such as crude oil can be used to produce a wide variety of products.
Controlling raw material supplies is essential. Many industrial processes rely on a constant supply. Interruptions can force the entire production process to slow down or stop, potentially leading to a knock-on effect with delays. Many businesses specialize in the extraction, storage and shipment of raw materials, relying on a variety of logistics tactics to ensure they always have enough on hand for their customers. Expedited shipping methods have greatly increased the availability of many once rare commodities.
Trends in manufacturing can lead to sudden spikes in demand for some materials, sometimes leading to shortages. The increase in biofuels, for example, has caused an increase in the demand for grain, causing the price of all types of products made with grain to rise as the raw materials have become more expensive. In some cases, it was difficult to obtain grains to make certain types of products, such as tortillas, and populations experienced shortages of needed food until the agricultural industry could adjust production and output to meet the demand.
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