China demand doesn’t mean a one-way metals bet

The story of Chinese demand has propelled commodity prices for years now, and is a widely recognised driver of a ‘super-cycle’ in commodity prices. But too often this leads to hasty assumptions that commodity prices will continue to outpace GDP growth in China, India and other big emerging markets. “People invest in scarcity,” notes John Browning, head of metals at Newedge, a leading broker in base metals. “The supply of copper is finite. But then why do prices change? It’s beca…