Venmyn mineral industry adviser Neil McKenna has explained today (7th October) that he believes that the long-term fundamentals for commodities are strong.

Most commodities, with the possible exception of gold, have suffered over the past few weeks in the midst of the current liquidity crisis gripping the financial markets.

But Mr McKenna has explained that these trends are unrelated to commodities themselves and that mineral projects should be expanded to satisfy demand in the long run.

He said: "The fundamentals of demand must still be strong, and as we see more and more minerals projects being put on hold due to financing constraints, I question from where the demand for commodities will be satisfied in the long term.

"This should really be the time for rapid expansion of minerals projects, and I certainly hope this current market crisis is only temporary."

Mr McKenna's comments were corroborated yesterday by Dr Azar Jammine, Director and Chief Economist at Econometrix, who claimed that commodities will resume their upward trend in the long term.

He explained that the fundamentals of supply and demand for commodities are still in place and that the amount of liquidity currently being pushed into the economy will work to their benefit in the coming years.



Source:

Rapid mineral expansion needed, not curtailment – Venmyn (07/10/08)
http://www.miningweekly.com/article.php?a_id=144614