Basic Industries

Basic Industries

Basic industries

The oil, chemical, textile, paper and steel industries are the 'basic industries' in that all other industries are dependent upon them. The two large sections of the market, consumer goods and capital goods, have their manufacturing materials supplied by the 'basic industries'. It is for this reason that the basic industries are the next most important, after consumer goods (the subject of the last webpage ), from the investment standpoint.

Furthermore, these basic industries are themselves inter-dependent. Thus oil provides the power and the lubrication for the machinery (including transport) of other basic industries; oil-chemicals furnish synthetics for the textile and chemical industries. The oil industry, in turn, is a heavy consumer of steel for its installations, pipelines and tankers. In modem industry there is no real line of demarcation between chemicals and textiles, all large chemical companies having textile sections and vice versa. Again, under modem conditions all metal finishing is a chemical process. So also are paper bleaching and pigmentation.

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