Rising costs could be due to many factors. Apart from volatility and supply -demand imbalance ,the reasons could range from political , trade agreements between few countries at the cost of others and calamities(Covid-19). Single source supplier could also create havoc in manipulating prices. As regards resource depletion, it is not as if it happens within a short period. The industries are all well informed about the availability of raw materials and accordingly are working on newer technologies so as to reduce dependence on the depleting resources. In fact tech disruptions have become so common that new products with better features at less cost are replacing the existing ones. Coal( nuclear), petrol( Hybrid) etc are examples of depleting resources and alternatives

Rising costs could be due to many factors. Apart from volatility and supply -demand imbalance ,the reasons could range from political , trade agreements between few countries at the cost of others and calamities(Covid-19). Single source supplier could also create havoc in manipulating prices. As regards resource depletion, it is not as if it happens within a short period. The industries are all well informed about the availability of raw materials and accordingly are working on newer technologies so as to reduce dependence on the depleting resources. In fact tech disruptions have become so common that new products with better features at less cost are replacing the existing ones. Coal( nuclear), petrol( Hybrid) etc are examples of depleting resources and alternatives

I agree with Gopaldas that many factors can influence prices, from resource availability to human manipulations of the market.

I agree also with Dr. Gopaldas Pawan Kumar

Best regards

Many factors affect energy costs. thus, you can consider an equation for this purpose that contains some variables and weighting factors. It should be noted that in this equation, the weighting factors are time functions.

Fully agree with Dr. Gopaldas Pawan Kumar

Not necessarily. The reduction maybe artificial to drive the prices up. The price of nickel is a good example. The nickel industry is very anxious to increase the price to make more money, but the resources are and will be endless.

Dear Nacef, a key point is the economic valuation of natural resources (natural wealth). If resources are not properly valued, then markets will not internalize their "price" and therefore their unsustainable use will cause depletion. I recommend you take a look at the World Bank´s report on natural wealth and accounting to put this issue in perspective.

https://www.worldbank.org/en/news/infographic/2018/01/30/the-changing-wealth-of-nations

Best regards,

Nacef Tazi , rising costs/ prices of resources can be explained by several ways as have been suggested by the earlier discussants, especially, Dr. Gopaldas Pawan Kumar. It's more likely that the scarcity of the resources in question causes a rise in prices of the resources. If genuine scarcity causes a rise in prices of resources, then it's not a matter of worry, rather, countries should encourage such pricing policies. Proper pricing policies and regulations can help countries develop appropriate resource pricing strategies and this is a matter of concern especially for developing economies while making resource allocation/ pricing decisions. Now, linking this question with respect to developing measures of sustainability, how do you propose to fix the indicators that captures the various points, such as scarcity value, monopoly pricing issues, the varying national policies (political systems as well) affecting the pricing decisions with respect to the scarce resources? A case in point that I want to mention here is the Covid-19 induced global economic recession and its impact of oil prices. As we are aware, when globally oil prices are on the decline, such a decline in prices does not percolate down in several countries, including India. How do we capture such scenarios in the framework of your sustainability analysis involving development of indicators?

Dear all,

Thank you for all your interesting answers.

It is thus a daunting task to include and capture all parameters (cited in your answers) so we can construct a sustainability criteria or a pressure indicator of resources. Perhaps, as Mahdi Saadatmand mentions, we could put some weighting factors.

As for the other answers, i think that developing a regional indicator that takes into account regional factors (economy, policy...) would be more suitable.

Actually, Michael Issigonis comment worth more consideration. The pricing policy of resources can be easily influenced by such artificial/human factors.

May or may not be.

(1) The real scarcity of the resources make hike in price due to increasing demand and less supply.

(2) The supplier used to stock the resources for their own benifits through making artificial gap between demand and supply.

No. It could be an indication of their increased demand due to increases in pollution and change in production/consumption trends.

Many factors can influence prices. We can start from demand and supply, availability of the resources, credit and market policies

Yes! That is possible.

It is certainly a possibility. The issue is that there is no one answer answer to your question. There are so many factors that contribute to the market price of a commodity that it should only be looked at as a dynamic network/web. For some commodities, that it definitely the case. It can also be argued that costs might decrease for a depleting commodity once it is no longer needed or useful, to try to draw attention back to the commodity.

The depletion of natural resources is a serious economic problem. It occurred because the speed of resource consumption is faster than the speed of recovery. This is due to an increase in the number of people, as well as an increase in their needs.

Natural resources are all objects and phenomena of nature that are used to meet the needs of society. They are divided into 2 categories: renewable and non-renewable.

Renewable natural resources have the ability to recover over time: forests grow, water is purified, animals reproduce, and so on. However, due to the increasing needs of humanity, the rate of resource consumption has exceeded the rate of recovery, which leads to their destruction and further exacerbates the problem.

Non-renewable natural resources do not have the ability to recover at all (or it takes too long). These include many minerals (such as oil and coal), and eventually they will all be exhausted. In this situation, you can only start using them more efficiently, but... rationality and humanity are incompatible concepts.

The causes of natural resource depletion are:

- Overpopulation of the planet (More people - more resource consumption).

- Water pollution (leads to a decrease in the volume of drinking water and the extinction of many aquatic animals).

- Air pollution (Leads to the extinction of many living organisms).

- Soil contamination (Leads to vegetation suppression).

The depletion of resources and their withdrawal from nature (even if only in certain regions) leads to a violation of the cycle of substances in nature. This, in turn, causes a number of other small changes, including changes in the biosphere. In nature, this interference has a negative effect, and does not lead to anything good. This:

- Destruction of entire ecosystems. What is associated with the pollution of nature or the complete destruction of a certain type of natural resources in a certain area (for example, deforestation or drainage of swamps).

- Soil degradation. Occurs due to soil contamination or removal of minerals from it.

- Destruction of living organisms. The mass extinction of animals is explained by the pollution or destruction of the ecosystems in which they live.

- Decrease in the fertility of plants, or their complete inability to grow and develop correctly. This is due to soil contamination or the development of land resources.

- Lack of food and water. Many people on our planet (mostly in third world countries) we have already experienced this problem. It will only get worse.

The depletion of natural resources is an important environmental problem. And to avoid disastrous consequences, you need to start doing something now. Then it may be too late!

I think, we need a fresh approach to the resource use strategies from now on. Perhaps, one has to take this as a corrective measure adopted by mother nature, to make human society aware of the resource depletion problems that we are facing, be it any natural resource, for that matter. Sustainable models of resource allocation and use suggest three scenarios, viz., (a) Worst Scenario, where, Rate of Consumption (RC) of Resources > Resource Replacement (RR); (b) Best scenario, where, RC

To solve your questioning, you have to go into complexity. In a network where all industries are increasingly interconnected, input prices effectively respond to multiple variables such as: abundance in nature, strategic / arms interest, types of technological development that use it, level of equity in its geographical distribution , difficulty of obtaining / extraction and amount of time necessary for its natural reproduction, among other things.

It is partially true. Yes, the natural resource are depleting very fast for our greed. As a result its price is increasing. But many of the essential natural resource's price has not increased compared to others. Just like, in today's world energy is very much required for every sector. We know that it can exist for maximum of 100 years if we do not find any suitable alternative. Its price is increasing. But if we compare it we other non essential products like gold or silver, we can find out that the change is not that much. Only those renewable energies are low in price in market which may not be renewable like electric cars. So, yes the price of substances are increasing because of their unavailability. But sometimes the increase is biased and decided by respective authorities.

I think you'd have to compare costs against a benchmark of value - say measuring in hours of labour (GNP/hours worked).

The math behind Hubbert's curve looks suspiciously like the sum of two resistances, one that increases exponentially with time, and one that decreases exponentially with time. That would be 'availability of source' and 'technology to extract' respectively. You could plot out the production curve and take the part that is 'availability' - has the production curve passed the first inflection point? Peak? Second inflection? I think Hubbert's curve is a good first pass, but a slightly different solution might be better for describing the trailing limb. Long story there...

If I think back to whaling - price volatility preceded the collapse of the industry. We're seeing price volatility with fossil fuels right now, which drives consumers away when the price is high, and drives producers away when prices are low. Eventually, before we've exhausted the resource, the alternatives have dominance. So price volatility that exceeds the capacity of the consumer and producer to just roll with it might be a very strong indicator of the end of use of a resource, even if it doesn't indicate the depletion, by itself, very well.