Lead/Industrial Metals OutlookThis information reflects a difference of opinion as to the price of lead, etc., FWIW:
2005/04/04
The surge in commodity prices enjoyed by Australian coal and iron ore exporters is likely to be shortlived, a new report has found.
******** latest mineral monitor report said although major commodities were enjoying good prices now, that would soon come to an end.
It might not be good news for exporters, but ***** is also expecting oil prices to come back to earth.
"Continuing global (especially Chinese) growth has created a second wind for commodity prices, notably for bulk commodities (coal, iron ore, LNG)," it said. "That has extended the life of what was already a three year boom.
"But the commodity cycle continues to look relative mature - the supply cavalry is one the way, while global growth already appears to be easing. This could undercut industrial commodity prices through 2006."
Hard coking coal is forecast to reach $US123.70 a tonne this quarter, before falling back to $112.70 a tonne through to 2006.
Lump iron ore is forecast to reach $US78.20 a tonne this quarter before retreating to $US70.80 a tonne, while fine iron ore should come back from $61.40 a tonne this quarter to $US54.20 a tonne by the end of 2006.
Oil prices are tipped to moderate slightly to $US38.10 a barrel by the the December 2006 quarter.
But **** warned oil prices could easily remain high, particularly because of growing demand from China, the United States and India, and higher production costs.
Rutile, gold, silver, platinum, nickel, tin, copper, lead, alumina and cobalt prices are all tipped to ease in coming months.
**** said current cobalt and nickel prices seemed to be the most over-valued, with cobalt 58 per cent and nickel 46 per cent above their long term averages. Rutile and ilmenite were reasonably close to their long term average prices.
Meanwhile, **** today largely backed **** forecasts. In its own commodity report, **** mineral and energy economist, **** said commodity prices were reaching their peak.
"Global commodity prices will come off their current highs but will be supported in coming years by solid economic growth in China and the US," he said.
**** expects aluminium prices to weaken next year, copper prices to moderate while lead and nickel will remain relatively strong.
It believes crude oil prices will remain high until OPEC provides extra capacity, with coking coal prices to remain strong until next year.