Of late your scribe has been on the wrong end of a nasty ear infection – and has also spent a lot of time listening to company administrators – with the former affliction apparently unrelated to the interactions to the latter.

So much for the mining boom 2013-style.

Leaving aside the challenges of the Eustachian tube – and of company administration travails too for that matter – things seem to have got more than a little gloomy in the mining world in recent days and weeks.

So who is to blame for all this?

A natural inclination when things aren’t going quite to plan is to blame someone else.

The government is usually near the top of any hit list and then comes just about everyone else from A through to Z – hopefully accompanied by a look in the mirror too.

A recent comparison of copper prices is illustrative.

In a presentation on behalf of CRU Group recently, your scribe had a good excuse to compare copper prices in 2011, 2012 and 2013.

Back in March-April 2011, with the copper price up around $US9500 per tonne (remember those good old days?) CRU’s econometric analysis of the constituents to the copper price returned a result of just $5500 of the copper price at the time originating from market fundamentals.

For fundamentals, read supply/demand, inventories, China import/export balance, currency effects and energy movements.

Conversely the remaining $4000/t originated from investment effects (the various influences of index funds, hedge funds and short-term traders).

Fast forward to March-April 2012 and the situation had changed.

Now the copper price came in at around $8500/t – but with fundamentals actually up to around $6500 and investment effects down sharply to $2000.

By March-April 2013 and a $7000-7500/t copper price, the fundamentals were holding ground at $6000 per tonne – but investment effects had collapsed further to just $1000-1500/t.

So who sets the prevailing copper price?

Clearly fundamentals play a major role – but investment effects are the principal driver of the prices at the margin.

So who then is to blame?

The answer it seems in this example is all those that trade in the copper market as investors.

Blame alone does not reside with professional investors in commodities for the broader market challenges of course.

Here then is the long list of who should be doing what – but isn’t.

Governments should promote and support (not impede) a national industry that has competitive advantage – such as the resources sector – as opposed to propping up losing industries with no comparative or competitive advantage.

Universities need to get closer to industry in order to produce more industry-savvy graduates – quickly. Industry should play an active role in this outcome too of course.

Mining companies need to be clear and transparent on their costs – and on project timelines. Incorrect costs and unrealistic timelines are still an industry-wide challenge.

Explorers need to target funds towards good projects with high impact pay-offs to company value – not towards over-drilling of prospects where the pay-offs are most likely sub-economic.

Let’s first start with fixing ourselves.

Good hunting.

Allan Trench is a Professor at Curtin Graduate School of Business and Professor (Value & Risk) at the Centre for Exploration Targeting, University of Western Australia, a non-executive director of several resource sector companies and the Perth representative for CRU Strategies, a division of independent metals & mining advisory CRU group (allan.trench@crugroup.com).