MANGANESE, molybdenum and bauxite have topped the annual list of hot commodities for 2009.
Zinc, vanadium and cobalt are in the deep freeze
Allan Trench, Australasian regional director of CRU research and advisory group said the "commodities thermometer" showed there were still opportunities for expansion and IPOs among junior miners with the right assets.
"We could see speculative runs for juniors exposed to next-generation 'sexy' commodities," Mr Trench yesterday told the opening session of Mining 2008, a mining and energy investment convention in Brisbane.
"There is opportunity for the likes of tin, manganese and bauxite -- in the same way there was in uranium two years ago and as there was in phosphate earlier this year -- for IPOs."
For the companies whose fortunes rise and fall on where their assets rate on the CRU thermometer, the road ahead is rocky.
Mark Simpson, Patersons Securities' head of research said, although the current market had overshot on the downside, falling nickel, zinc and copper prices meant that many projects "need to be mothballed" and development and exploration will be curtailed.
"Capital preservation is the key," Mr Simpson said. "There is a light at the end of the tunnel -- it's about surviving until then. For those looking for funding it's tough out there."
Despite the gloomy outlook, developers and explorers remain optimistic.
Andrew Caruso, managing director of mid-cap iron ore developer Australasian Resources -- which has its Balmoral South project on the Pilbara coast -- said: "The fundamentals are in place for continued Chinese demand in the future.
"We plan to become an iron ore producer within three years," he said. "There will be a hiccup for the next six to 12 months -- stockpiles need to be bought down and there clearly needs to be a cleansing in the world markets, but we feel iron ore has a very strong future."
Nanette Anderson, managing director of explorer Jaguar Minerals, said falling costs created scope to acquire assets that were previously "over-inflated".
"Although it is tougher and you have to do it smarter and have tighter budgets in this market -- if you're committed to exploration and discovery like Jaguar is, this is where the opportunity will find you, away from all the over-inflated commodity and share prices," Ms Anderson said.
The much longed for recovery could see a return to the boom-bust cycle, said Trevor Woolfe, from Stock Resource.
"Commodity prices have been driven down too hard and too fast in the current turmoil," Mr Woolfe said.
"This is causing mine closures and deferral of development projects. Once markets settle and demand re-emerges we are at risk of facing the same severe supply constraints (experienced since) 2003, thus fuelling high commodity prices environment once again.
"This, combined with the global low interest rate environment, means we also run the risk of fuelling inflation and returning to the boom-bust cycle."
