The price for nearly all metals has risen steeply over the past few years, causing pain for buyers of commodities from steel to copper to titanium. The continued merger activity among producers may put even more pressure on prices, as the combined companies can more easily limit supply.

There have already been a number of mergers in the sector over the past few years, and now aluminum giant Alcoa announced Monday its intent to acquire Canadian rival Alcan. Interestingly, Alcoa had been forced to split off Alcan in 1950 over U.S. antitrust concerns.

The deal will again raise significant review by anti-trust regulators and could well be blocked. But many mergers have already gone through across the globe, as metal producers seek to acquire shrinking pool assets before competitors do. Meanwhile, China is investing heavily to lock up commodity supplies, and Western companies are often signing very long term contracts. Some companies have even made moves to a more vertically integrated supply chain to better control commodity supplies and prices (See Supply Management: The Return of Vertical Integration?).

Whatever happens to the Alcoa bid for Alcan, proposed and actual deals are likely to continue. There were also strong rumors this week, for example, that global giant Mittal Steel would look to acquire U.S.-based AK Steel.

Commodity prices are famously volatile, and some believed that after a big run since 2004 increased supply coming on line would drive prices of metals back towards more historic levels. But the voracious demand from the surging economies of China and India make it tough for even growing supplies to keep up with global market demand, and many think these mergers will put even more of the balance in the producers’ favor by enabling them to better control supply.

Additionally, cash spent to buy rival mines and production assets is money that can’t be spent on developing truly incremental capacity.