Copper supply shortfalls may deepen should growth accelerate.
China's official purchasing managers' index increased to 50.5
last month, the highest since September, data from the statistics
bureau on Feb. 1 showed. India's manufacturing grew at the
fastest pace in eight months in January, HSBC Holdings Plc and
Markit Economics reported the same day. The Institute for Supply
Management's US factory index rose to the highest level since
June last month, the group said two days ago.
Raw materials are rebounding from the first annual drop in
three years on growing signs the world will skirt another
recession and reports that manufacturing is expanding from China
to India to the US Investors are betting record-low US interest
rates and China's efforts to shore up growth will bolster demand.
The optimism is being tempered by Europe's widening debt crisis,
with the International Monetary Fund warning it could derail the
While global growth may be slowing, the consumption of
commodities is expanding faster than supply. Morgan Stanley
predicts shortages in copper, palladium and iron ore this year
and Barclays anticipates the same thing for tin. The London-
based bank also expects oil inventories to drop in the third and
fourth quarters as production falls short of demand. Rabobank
International forecasts deficits in coffee and cocoa.
China's economy will expand 8.1% this year, and up to 8.7% in
China's economic growth will decelerate to around 8.1% this
year and edge up to 8.7% in 2013.
China's manufacturing activity is far from optimistic despite
the Country's Purchasing Managers Index (PMI) for the
manufacturing sector rose slightly in January.
The China Federation of Logistics and Purchasing has said that
China's PMI rose to 50.5% in January, the highest level since
October. The PMI stood at 50.3% in December, and 49% in
The manufacturing sector is currently going through
He sees China's gross domestic product (
) growth will be the slowest in Q-1 and gradually pick up later,
bringing the growth rate for Y 2012 to around 8.1%.
China's economy expanded by 9.2% in Y 2011 from a year earlier
and 8.9% Y-Y in Q-4, according to the National Bureau of
). The Quarterly growth was the slowest in 10 Q's.
Shayne Heffernan oversees the management of funds for
institutions and high net worth individuals.
Shayne Heffernan holds a Ph.D. in Economics and brings with
him over 25 years of trading experience in Asia and hands on
experience in Venture Capital, he has been involved in several
start ups that have seen market capitalization over $500m and 1
that reach a peak market cap of $15b. He has managed and overseen
start ups in Mining, Shipping, Technology and Financial Services.