Gold, for example, was recently trading below US$800 an ounce, having nearly touched a high of US$1,000 an ounce in mid-July. Copper was recently quoted at about US$3.32 a pound, off a high of more than US$4 in July. Likewise for aluminium, which was trading near US$1.25 to US$1.29 a pound against its year-to-date high of US$1.48 per pound.

Other non-ferrous metals, such as lead and zinc, have also seen their prices drop sharply of late. This has had a significant impact on the mainland, which is a major producer of these metals.

'China's mining and metal sectors are looking at uncertain prospects in the months ahead as the rapid turn in the commodity prices has equity investors looking spooked,' said Martin Wang, a research analyst at Guotai Junan Securities in Hong Kong.

'In the past two years, the steady increase in production costs for the sector was offset by the matched appreciation in commodity prices, which allowed many of China's leading mining companies and metal producers to achieve record levels of growth.

'Now, the downturn in commodity prices is seeing many analysts take a more cautious approach to these companies.'

More bad news for the mainland's mining and metal companies is the slowdown in the global economy, and fears that it may affect China's own economic growth.

'Globally, we've seen a sell-off [in China's mining and metal stocks],' said Andrew Driscoll, research analysts for CLSA.

'This is a function of a China growth scare amid a deteriorating global growth outlook, and rotation from out of the more cyclical assets, which has led to the correction.'

Ironically, these warnings come as many of the mining and metal companies listed on the Hong Kong stock exchange look set to report solid half-year earnings, according to the majority of analysts surveyed.

Xinjiang Xinxin Mining Industry is expected to report strong earnings growth on the back of steady production increases and a strong management team when it releases its half-year earnings on Wednesday.

Likewise, analysts are upbeat about the earnings of Yanzhou Coal Mining, one of the three leading coal miners on the mainland.

The company is expected to declare good earnings growth on the back of a steadily increasing domestic coal price on the mainland, even though production is expected to remain flat.

'[Yanzhou Coal] is performing the best among its peers. Its growth rate was the highest in first half of the year, with 113 per cent year-on-year growth in the first quarter, so that could hint at high profit growth ahead,' said Michelle Leung, assistant vice-president of research at CIMB Group.

Yet, despite the positive earnings outlook, many analysts are taking a cautious 'hold' position on these stocks, with some even declaring them an outright 'sell'.

Yu Shi, a research analyst at CM-CCS Securities, said China's coal mining operations faced a tough market ahead.

The mainland's domestic coal price had appreciated almost 60 per cent in price in recent years, Ms Shi said, and, unlike the international coal market, responded primarily to internal demand rather than global demand.

This mammoth increase has set the commodity up for price caps, as Chinese regulators look to ease inflationary pressures in the mainland's economy.

In addition, the coal transport bottleneck will add significant price pressure, compounded by strict environmental, safety and labour regulations being tabled by the Chinese government.

China's steel sector is also facing grim market conditions. In a recent research report on the ferrous sector, Citi predicted that a significant weakening in demand, coupled with the weakening macroeconomic conditions, would put considerable pressure on steel prices. There was also a significant spike in the cost of raw materials.

'Steel manufactures have faced a cost hike in the previous half-year, which has seen their earnings severely affected,' explained Create Lee, a research analyst at Value Convergence Holdings.

'Much of their iron ore comes from the parent companies, and there is a six-month pricing lag on iron ore, which they are feeling now. As a result, investors are trying to sell off their stock, and a large drop is a possibility.'

Several research houses have already relegated the stock of China's major steel and iron producers to 'sell', including Angang Steel and Shanghai-listed Wuhan Iron and Steel. This casts a foreboding shadow on other steel producers, such as Maanshan Iron & Steel.

But is it all doom and gloom for the mainland's mining and metals sectors? The answer from the analysts interviewed seems to be no, provided that investors look beyond the short term.

'I don't think China's economy is going have a meltdown in 2009. Certainly, the international market is going to feel the effects of a slowdown, but China and India are still dominating.

'They still have strong internal demand and industrial demand, so the macroeconomic factors are not going to be that significant for them,' Mr Lee said.

In fact, some speculators say that this might be a good entry point into the market, provided investors select their stock carefully. One such example is China Molybdenum.

'The company has good market prospects, and the fundamentals are positive. Molybdenum is used extensively in the energy sector, and we don't see a slowdown in demand in the near future,' said Zhang Xi, senior analyst for UOB Kay Hian.

'The company's prospects also look good from a long-term perspective.

'They are set to start producing sulphuric acid in the second half of the year, which is quite hot right now, and will have a positive impact on the second half results.'

There is also a widely held view among financial analysts in the market that the downturn on commodity prices is temporary.

'We believe that long term there is a bull market for commodities, and we will see an upswing in prices once the global market shrugs off the effects of the subprime crisis and its impact economies,' Mr Lee said.

The question is: how long will it take these negative effects to clear the system before China's mining and metals sectors regain their lustre?

The answer from analysts seems to be a muted 'tough short- to medium-term', but nothing more definitive than that.