December 9, 2020
Minerals Energy Outlook: December 2020
Markets have been buoyed by positive COVID-19 vaccine news, which could correspond with stronger economic activity and demand for commodities next year.
November saw a strong upturn in most metals markets – with gold the exception, as positive vaccine news boosted equities markets and hit the precious metal. In contrast, energy markets were mixed, with LNG higher, oil still well below pre-COVID-19 levels, and coal impacted by Australia-China tensions.
- The trade relationship between Australia and China remains fraught, with tensions continuing to rise. Coal has been the main resource commodity impacted (along with copper), however we can not rule out further restrictions.
- More generally, markets have been buoyed by positive COVID-19 vaccine news, which could correspond with stronger economic activity and demand for commodities next year.
- In annual average terms, our US dollar non-rural commodity price index is forecast to fall by 4.0% in 2020, before increasing strongly in 2021 – up by 12.0% – driven by a recovery in LNG prices, stronger average prices for iron ore and (to a lesser extent) the pickup in thermal coal and copper prices – however all commodity markets are forecast to see higher prices next year.
Find out more in the Minerals & Energy Outlook – December 2020