Column: China’s commodity import trend driven by prices, not economy
China's imports of major commodities are often viewed through the prism of the performance of, and outlook for, the world's second-biggest economy.
SNL Metal Economic Group’s Pipeline Activity Index (PAI) rose during the two months of September and October to tap a six month peak, while the number of initial resource announcements during the period comprised the highest two month total in over four years.
Data compiled by the mining analysis company indicates an overall uptick for the resources sector during the period. Financing displayed modest improvements in October with a large number of underwritten equity raisings, while drilling activity is up now for the third consecutive month.
Aggregate market cap saw modest improvement, hitting $1.74 trillion by the end of October for its highest level since April, yet still substantially beneath the key $2 trillion level.
With the outlook for the global resources sector still highly uncertain, Metal Economic Group cautions that these improvements could be significant of seasonal variations. The September quarter is usually the peak period for drill reporting and junior company financing.
The SNL MEG Pipeline Activity Index assesses overall activity in the supply pipeline, providing a single metric which encompasses significant drill results, initial resource announcements, project development milestones and significant financings.
