• E-mail
• Print
• Comment
• Font Size
• Digg
• del.icio.us
• Discuss article

Power Demands Pushing Metal Prices Up

Posted on: Monday, 12 May 2008, 15:00 CDT

A global increase in energy demands have triggered price jumps in metals, as power shortages from Chile to South Africa have limited production, analysts say.

The power it takes to run an aluminum smelter in China could supply 2 million people with enough power for a year, The Washington Post reported Sunday.

Power shortages have contributed to price increases in platinum, aluminum, and copper, up 24, 21 and 26 percent this year respectively, the report said.

There will be a sustained level of risk from power shortages in the commodities markets, Michael Lewis, the head of commodities research at Deutsche Bank told the Post.

We are pricing bigger supply losses as a result, he said.

The demand for metals may have waned in the United States, where consumer spending is down, but emerging markets are keeping global demand intact, analysts said.

To allow China and India to have a middle class, we need to go back to the drawing board and boost investments in power infrastructure, Francisco Blanch, a commodities researcher at Merrill Lynch said.

And if this doesn't happen, we're going to see even more brown-outs, Blanch said.

Source: United Press International

More News in this Category