Factors including supply shortages, work stoppages and recent policy changes by the Chinese government are driving up prices of Canadian metals
TORONTO—A renewed sense of optimism is expected as representatives of the global mining industry gather in Toronto for the annual convention put on by the Prospectors and Developers Association of Canada (PDAC).
This time last year, the prices of most industrial commodities were sitting near cycle lows and sentiment was dour. Since then, prices have risen across the board.
The Soctibank Commodity Price Index rose by 6.4 per cent in January, thanks in no small part to strong performance in the metals and minerals sector, which rose by 9.9 per cent.
Here are the price forecasts for Canadian metal markets:
For those in mining and metallurgy, there is reason to celebrate, but the price increases for many metals are due to short-term factors that could change quickly.
“While the worst is likely behind us, the pace and magnitude of some of these recent price gains has been exaggerated, driven by short-term government policy, rather than organic industrial fundamentals,” said Rory Johnston, commodity economist at Scotiabank.
He continued, “Many of these uncertainties relate to policy out of Beijing, which has the unique ability to sway the fate of virtually every material, but we will also see how Indonesian, Filipino, Chilean, Indian and American policies are all affecting commodity prices in one way or another.”
To see more details on the minerals sector and commodity price breakdowns for other sectors of the Canadian economy, read the full Scotiabank Commodity Price Index Report here.