Some commodities to take hit from China: analysts (by Chris Oliver)
HONG KONG (MarketWatch) -- Demand for industrial commodities is headed for a softening because China won't be able to offset dwindling consumption in the euro-zone economies, Capital Economics analysts said in a note distributed to reporters Thursday. Views that China's rising demand will support the global commodities is misguided, the analysts said. China's annual growth rate is set to slow to about 6% on average during the next decade as the supply of cheap labor dries up, cooling from current annual growth of about 10%. Crude oil in particular may see a potential drop as falling demand in Europe outpaces rising consumption in China. "The fall in oil consumption in the euro zone during the recession of 2009, measured in numbers of barrels, was twice as large as the increase in consumption in China during that year," Capital Economics said. Europe accounts for about 12.5% of global crude-oil consumption, outpacing China's 10.6% share.