Scotiabank’s Mohr argues strong case for commodities now to 2020 – by Kip Keen (Mineweb.com – February 4, 2013)

http://www.mineweb.com/

Scotiabank’s Patricia Mohr delivers a bullish stance on emerging markets and thus demand for commodities such as copper.

HALIFAX, NS (MINEWEB) – Patricia Mohr, Scotiabank’s commodity market specialist, made the case for higher or resilient prices for commodities, including copper, potash and uranium, in the near and longer term.

Mohr, speaking on the last day of AME BC’s Roundup conference last week in Vancouver, grounded her views on increasing demand from emerging markets.

Potash price – Close or at bottom

Mohr noted food prices are high and “this is going to incent farmers to apply a lot of potash next spring, something we expect is going to happen.” Vancouver free-of-board potash prices softened recently, she noted, but she said the soft spot probably put a floor on the price of potash. She pointed out that major potash customers have deferred buying and they would soon have to step it up again, with growth mainly coming from China and Brazil.

Uranium price – Fukushima overhang over

She forecast uranium prices, now languishing in the $40s per pound range, would rise to $60 to $65 per pound by mid-decade.

Three reasons for the renewed strength in the price of uranium were that: 1. Japan, which shut down reactors across the country following the Fukushima nuclear disaster, would bring reactors back online again; 2. demand from China would rise as it builds planned reactors; and 3. the U.S.-Russia Megatonnes to Megawatts program is to end, taking about 24 million pounds of U3O8 off the market.

Copper price – New basement

Mohr said that at current prices copper is “incredibly profitable” for producers, with strong demand in face of very little mine supply.

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