Global diversified mining group Xstrata (listed in London)...

Global diversified mining group Xstrata (listed in London) provided the following postive outlook commentary for commodities in its CY06 results release overnight:

"Commodity prices have again performed very strongly in 2006. While it is unlikely that average prices for base metals will continue to rise at a similar rate in 2007, the fundamental outlook for the industry remains positive. The rapidly industrialising economies of China and India and the satisfactorily performing economies of the older ‘Asian tigers’ and Europe will continue to drive demand growth for metals and energy, despite an underperforming US economy.

"On the supply side, the tight availability of major projects, skilled resources and cheap power and the challenges of difficult geographies, inadequate infrastructure, significant cost inflation and the depleting nature of reserves across the industry will continue to moderate growth in production.

"As a consequence, there is no sign that commodity prices are rapidly returning to long-run averages, and the price environment remains very favourable, particularly in our traded thermal coal..."