• NAB’s Non-Rural Commodity Price Index is forecast to fall significantly in Q4 2019 – down by 8.2% qoq in US dollar terms. The key drivers of this downturn are iron ore (which fell rapidly across the third quarter) and LNG (reflecting the lagged impact of earlier falls in oil prices).
• The global economic outlook remains broadly negative for commodity markets – reflecting slowing activity as well as the impact of US-China trade tensions that have harmed industrial commodity consumers. The potential for trade measures to extend to Europe adds downside risk.
• In annual average terms, US dollar commodity prices are forecast to increase by 4.7% in 2019, before falling by 10.5% in 2020 and a further 1.0% in 2021. Iron ore and metallurgical coal are the main contributors to the overall fall in the index in 2020, while gold prices are expected to trend higher over the outlook period.

Find out more in the Minerals & Energy Outlook – October 2019