During the depression after the world war I, the `Big 5 Japanese Copper Companies' (Furukawa, Sumitomo, Mitsubishi, Kuhara, and Fujita)came to produce about 95 percent of the copper output in Japan. This high concentration of copper output resulted from ore trade system (baiko-system)peculiar to Japan. In 1910s, big mines under the control of these ` Big 5' got to buy ores from smaller mines near by, and gradually expanded their own smelters and refineries. The invitation of Pyrite Smelting at the Kosaka Mine in 1900 was, in terms of productive capacity, the pre-condition for the ore trade system to develop. With the spread of Pyrite Smelting, the smelting furnace became more enormous, and smelting productivity rose higher. This reduced the smelting cost and necessitated a huge amount of fixed capital, which made it very difficult for the smaller mines to keep up their own smelters, and caused them to sell their ores to big smelters. In this process, there lay several factors which made ore trade system grow more and more: reilways were nationalized in 1907, which made freight much less expensive; air pollution from smoke posed a severe social problem; a system of taxation was reformed ; and so forth. A new business relation in ore trade, that is a loan advance from smelters to smaller mines, made the control of big smelters of big smelters over smaller ones muchstronger. Thus ore trade rapidly expanded in 1910s. During the world War I, the amount of copper ores processed at the main refineries increased by about 700,000 tons, 70 percent of which was bought from smaller mines near by Though copper output decreased greatly after the war, the ore trade did not show a proportionate decline; for smelting and refining capitals intended to save elasticity of copper output by adjusting ore purchase. So in 1929, the main smelters and refineries in Japan possessed by the `Big 5 Companies' depended for half of their ores on ore purchase from smaller miners. As a result, while the ` Big 5 Copper Companies' could concentrate no more than 70 percent of copper ores output, they concentrated 95 percent of copper output because of the ore trade system. The monopoly of the copper trade was secured on the basis of the ore trade system.
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