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China’s top commodity trends and what
this means for Mongolia John Johnson, CEO CRU China
Prepared for:
Invest Mongolia 2014, UB
2nd September, 2014
• China’s Top 10 Commodities.
• Will China’s economic restructuring lead
to less imports of key commodities?
• Or will environmental issues reduce
production levels and create opportunities
for imports?
• Future megatrends, prices and margins.
• What opportunities are there for
Mongolian commodities in China?
Agenda
China’s top 10 commodities
CRU China 10 report
3
Rank Commodity Value $ billion Value $ billion Value $ billion
2004 2013 2023
1 Steel 143 582 893
2 Coal 111 411 506
3 Aluminium 13 58 122
4 Copper 7 53 116
5 Fertilisers 9 37 42
6 Stainless Steel 6 26 56
7 Gold 2 18 16
8 Zinc 3 13 29
9 Lead 2 11 15
10 Tin 1 4 6
Top Ten Total Value 297 1213 1801
Proportion of China's GDP 15% 14% 7%
Data: CRU
China's ten largest commodities, by value of production, 2004, 2013, 2023
China’s economic restructuring…
4
…accompanied by cost increases…
5
…leads to China’s commodity importance declining
6
But will it lead to less commodity imports?
7
The answer is no, with imports largely rising
8
Will environmental issues reduce production?
9
1. China will continue to be resource constrained
2. Environmental issues will escalate
3. Structural changes will disproportionately impact different
commodities
4. China production costs will increase more than in most other
countries
5. Domestic margins will remain under pressure
Five important Chinese Megatrends
10
Future prices and margins differ by commodity
11
China still presents some opportunities for
Mongolia, despite the slowdown, in coal
12
China still presents some opportunities for
Mongolia, despite the slowdown, in copper conc.
13
China still presents some opportunities for
Mongolia, despite the slowdown, in iron ore
14
China may also present Mongolia opportunities in
other commodities such as:
Gold Zinc Tin
15
16
Thank you
John Johnson
CEO CRU China
CRU | THE INDEPENDENT AUTHORITY
517 Tower 2, Bright China Chang An Building, 7 Jianguomennei Avenue, Beijing 100005, China
Phone: +86 10 65102208
Mobile: +86 13911122605
http://www.crugroup.com
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