Although there are concerns over the Euro-zone economic fortunes, commodity-intense growth from developing countries, particularly China, will likely sustain demand for both industrial and precious metals, an analyst has said.
Barclays Capital managing director of commodities research, Kevin Norrish told the ongoing Investing in African Mining Indaba that rising living standards and increasing urbanisation in China and other developing countries were the major causes of the increased demand for metals.
“China is becoming more and more important, more and more quickly,” he said.
China accounted for 50 percent of all demand growth across commodity markets in 2010.
Meanwhile, Norrish said while economic conditions looked almost the same with that experienced during the global recession of 2008-2009, there were some distinct differences that suggested an improved outlook for 2012.
He said commodities such as nickel, copper and gold would likely register a growth in production.
Norrish said gold could reach over $2,000 an ounce, while platinum could reach $1,800 an ounce by the fourth quarter of 2012.
He also predicted that copper would trade at over $9,000 a tonne by the second half of the year.
However, supplies of other metals such as platinum, lead, zinc, silver, aluminium and palladium would likely remain flat or decline, Norrish said.
Mathew Nyaungwa, Rough&Polished, from Cape Town, South Africa
