What will be the turning point for mining and metals?
The turning point may be a result of the fiscal stimulus packages that have been announced – vast infrastructure programmes will absorb huge amounts of basic metals and mineral resources. Williams concludes: “The mining and metals industry will not be able to respond quickly enough to recovered economies to provide them with the scarce resources they will need. This will be compounded by a reluctance to repeat the same mistakes of the last few years. For example, mining companies are unlikely to want to borrow cash to make acquisitions for some time. But there will come a time when it becomes cheaper to build than buy. When that happens expect metal prices to set new highs.
