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US Mining Industry – Porter’s Five Forces Strategy Analysis

  • August 2014
  • -
  • Aruvian's R'search
  • -
  • 35 pages

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The United States mining industry is an important contributor to the nation’s economy and employs over millions of workers in this great endeavor to utilize the nation’s resources for growth and fuelling industry demand for raw materials which they process in order to remain global leaders.

The United States produces a wide variety of commodities from gold to coal. It has a land area of over 9.6 million square kilometers, 19,924 kilometers of coastline, and a population of over 298 million people. It uses 25% of the world’s energy reserves and spends more on maintaining its military might than most other country's entire GDP. It is with the support of the mining industry that the US has earned the coveted title of being the world's second largest producer of copper and gold, exporting over $26 billion worth of minerals and materials produced from minerals each year. Further, its mining industry employs over three million people directly and indirectly.

Aruvian's R'search analyzes The US Mining Industry in Michael Porter’s Five Forces Analysis. It uses concepts developed in Industrial Organization (IO) economics to derive five forces that determine the competitive intensity and therefore attractiveness of a market. Porter referred to these forces as the microenvironment, to contrast it with the more general term macro-environment. They consist of those forces close to a company that affect its ability to serve its customers and make a profit. A change in any of the forces normally requires a company to re-assess the marketplace.

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