Overview

• NAB’s Non-rural Commodity Price Index is expected to ease in Q1 2024 – down by around 3.3%. The key contributor to this downturn is liquefied natural gas (LNG), where a mild northern winter limited gas demand, allowing European storages to remain above its five-year average in late February.
• The impact of restrictive monetary policy in advanced economies and various headwinds to China’s economy should slow global economic growth to 2.8% in 2024. Outside the extreme outliers of the global financial crisis and the initial wave of COVID-19, this would be the weakest rate of growth since 2002. This is expected to negatively impact a broad range of commodities in 2024.
• In annual average terms, our USD index is forecast to fall by around 9.7% in 2024. This reflects falling prices for thermal coal along with iron ore and LNG. We forecast the Australian dollar to strengthen across 2024, meaning that there is a slightly larger decline in annual average AUD denominated commodity prices – down by 12.3%.

Find out more in the Minerals & Energy Outlook (March 2024)