Global economy, led by China, shrugs off soaring commodity prices

LONDON, May 14, 2006 (AFP) – The prices of commodities such as oil, copper, aluminium, platinum and sugar are smashing records — and will head higher owing to fierce demand from economic powerhouses India and China, analysts say. With sizzling rates of growth in the two emerging giants, home to one third of the world’s population, supplies of raw materials will likely be stretched even further.

Low global inventories, limited production, supply disruptions and fierce demand prompted frenzied speculative buying across much of the metals complex last week.

Platinum, aluminium, zinc, nickel and copper struck historic peaks, while silver and gold hit the highest level since 1980.

Copper forged a record 8,800 dollars per tonne and gold reached 730.40 dollars per ounce.

China is the world’s biggest consumer of copper, platinum, wool, cotton and rubber, and the second biggest market for crude oil after the United States.

India, meanwhile, is the largest consumer of gold and silver.

“With strong (economic) growth in the emerging markets and further acceleration in Japan and Europe expected to continue… we maintain a positive outlook for commodity returns, despite the recent price rally,” said Jeffrey Currie, Lond