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Gold/Mining/Energy : Mining News of Note -- Ignore unavailable to you. Want to Upgrade?

To: LoneClone who wrote (31012)	1/11/2009 6:57:55 PM
From: LoneClone	Read Replies (2) \| Respond to of 193842

Metals Prices to Be Lower in 2009 on Weak Demand, Goldman Says bloomberg.com By Madelene Pearson Jan. 8 (Bloomberg) -- Metal and coal prices are expected to average “considerably lower” in 2009 as demand plunges in a global recession and producers can’t cut supply fast enough, Goldman Sachs JBWere Pty said. Prices of coking coal may plummet by 60 percent, copper by 40 percent and aluminum by 28 percent, analysts led by Malcolm Southwood said in a note to clients yesterday. Commodity prices dropped 36 percent last year as a global credit crisis curbed demand and pushed the world economy into a recession. Mining companies including Rio Tinto Group, Alcoa Inc. and Aluminum Corp. of China Ltd. have slashed production. “With gold the most plausible exception, we expect 2009 annual average commodity prices to be considerably lower versus 2008, with negative implications for resources sector earnings,” the analysts said. “We expect global off-take of most metals and minerals to contract this year,” There will be oversupply of aluminum, copper, nickel and zinc and bulk commodities will also move into annual surplus in 2009, the brokerage said. China, the world’s largest consumer of metals, will hold the “key to sentiment” on commodities this year, Goldman said. Demand from China is expected to be very weak in the first half, improving in the second half driven by stimulus spending and as de-stocking runs its course, the analysts said. China plans to spend 4 trillion yuan ($586 billion) to support sagging growth by investing in metal-intensive projects including railways and homes. Copper has the “best potential for a large price rebound” in 12 months as the chances for output growth are “very modest,’ the analysts said. Price forecasts 2007 08 09 10 11 12 Aluminium USc/lb 120 116 84 100 112 120 Copper USc/lb 323 315 189 263 300 330 Nickel USc/lb 1689 955 567 725 825 850 Zinc USc/lb 147 85 60 73 83 93 Gold oz 697 872 815 848 883 919 Platinum US$/oz 1306 1580 835 869 905 941 Palladium US$/oz 357 354 200 200 200 200 Thermal coal $/t 55.65 125 70 75 70 70 Coking Coal $/t 98 300 120 120 110 110 Iron ore c/dmtu 80 145 101 101 91 82 Note: Iron ore prices are rounded. To contact the reporter on this story: Madelene Pearson in Melbourne on mpearson1@bloomberg.net Last Updated: January 7, 2009 23:29 EST