Rio Tinto Expects Stimulus, China Strength to Support Commodity Demand -- Commodity Comment
By Rhiannon Hoyle
Rio Tinto PLC on Tuesday reported a slight lift in 2020 iron-ore
shipments, and a fall in its output of mined copper. Here's some
remarks from the operational report on what it's seeing in its
On global commodity demand:
"Economic activity, particularly in Europe, continues to be
disrupted in the short term due to measures to combat Covid-19.
Monetary policy is expected to remain accommodative and fiscal
policy is also expected to be utilized extensively, both of which
should be supportive of commodity demand."
On Chinese demand:
"In China, the industrial sector has recovered and is now at
pre-Covid levels due to the rapid deployment of stimulus. Exports
continue to rise with the global economic recovery, and a policy
shift to promote domestic investment and consumption is supportive
of the commodity demand outlook."
On the iron-ore market:
"Iron-ore prices rose significantly in the second-half of 2020
on the back of tightened market fundamentals. China's buying
remains robust despite ongoing localized impacts from Covid-19 in
some regions. Demand in Japan, Korea, Taiwan and Europe is
recovering, amplified by restocking."
On the copper outlook:
"Copper prices remain strong. Chinese consumption is robust,
mine and scrap supply have been disrupted, and investment demand is
strong. We expect global fiscal stimulus, particularly in the
electrification and renewables sectors, to be copper-intensive and
supportive of the outlook."
On the aluminum outlook:
"The aluminium price has rebounded on solid downstream demand,
particularly in the automotive and packaging sectors. We remain
cautious on the outlook due to an expected increase in Chinese
supply and high global inventories."
Write to Rhiannon Hoyle at email@example.com
(END) Dow Jones Newswires
January 18, 2021 19:03 ET (00:03 GMT)
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