Aussie Miners Not Worried About China Growth
Source: Reuters, Manolo Serapio Jr. (8/2/10)
"China growing at volatile rates but it still needs commodities."
"The economy of China has free cash today in excess of $5 trillion and that's an economic powerhouse that just keeps on going for a long, long time," Gavin Thomas, managing director and chief executive of Australian miner Kingsgate Consolidated, told Reuters at the Diggers and Dealers conference in Western Australia on Monday.
"We see China growing maybe at volatile rates, but they will still need commodities. They're still building a Manhattan once a year, okay, they make three quarters of Manhattan."
Earlier Monday data showed Chinese manufacturing shrank in July for the first time since the global downturn in March 2009 as government steps to slow bank lending and fight property speculation hit home.
But a sharp decline in Chinese demand for iron ore, remains to be seen. China buys about half of its needs of the steel-making raw material from Australia.
"We have significant reliance on the Chinese economy, so any kind of slowing will affect us, but to what end is uncertain," said DJ Carmichael's James Wilson. "The Chinese economy is still coming very strongly, but there's also a concern of how strong it can be and how long that can be maintained before it runs into exhaustion," he added.