Business
        

Money

Growth may support prices of commodities

Updated: 2011-04-06 10:54

(China Daily)

Twitter Facebook Myspace Yahoo! Linkedin Mixx

 

 

Growth may support prices of commodities
 

The booth of Aluminum Corporation of China at a trade expo in Beijing. Demand for aluminum in the construction sector accounted for more than 35 percent of total consumption last year, according to Liu Xiangmin, vice-president of Aluminum Corporation of China.[Photo / China Daily] 


SINGAPORE - China's economy will maintain "stable" growth of 7 to 8 percent a year, supporting demand for commodities including aluminum and copper, said a senior official at Aluminum Corporation of China.

Demand for aluminum in the construction sector accounted for more than 35 percent of total consumption last year and is likely to maintain a similar level this year, Liu Xiangmin, vice-president of Aluminum Corporation of China, said at a conference in Singapore on Monday.

"There are many large construction projects on the national and town level in the 12th Five-Year Plan (2011-2015)," he said. "Demand will continue to grow."

China's manufacturing expanded for the first time in four months in March from February, a report showed last week, indicating that Premier Wen Jiabao is succeeding in sustaining growth while cracking down on inflation.

Related readings:
Growth may support prices of commoditiesChinese copper demand set to rise 
Growth may support prices of commoditiesChilean copper export shifted to China 
Growth may support prices of commoditiesJiangxi Copper eyes more mines abroad 
Growth may support prices of commoditiesCopper price falls 

China's central bank raised interest rates on Tuesday, for the second time this year, to tackle inflation and asset bubbles in the world's fastest-growing major economy.

Aluminum prices will increase as the price of oil stays high, driving up energy costs, which account for more than 40 percent of the cost of making the metal, Liu said. "It's a classic case of prices being pushed up by cost pressures. Substitution away from copper and steel in the transportation sector will also support prices."

Still, price gains will be limited by monetary tightening efforts taken by the Chinese government to tackle inflation, Liu said. Copper price increases will also be constrained by China's cooling measures, he said. Copper, at around $10,000 a ton, is trading "far above cost, and we believe prices will correct this year", Liu said.

Bloomberg News

Specials

Share your China stories!

Foreign readers are invited to share your China stories.

Fill dad's shoes

Daughter and son are beginning to take over the family business of making shoes.

Have you any wool?

The new stars of Chinese animation are edging out old childhood icons like Mickey Mouse and Hello Kitty.

Panic buying of salt
Earthquake Hits Japan
NPC & CPPCC sessions