Infra investments, supply shortages may keep metals firm: Expert

Supply shortages and infrastructure investment plans announced by both China and the US will keep metals on a firm footing at least in the medium term feels Annalisa Jeffries of Platts.

Speaking to CNBC-TV18 Jeffries says it has been a good year for China and the investments announced outside Chinese boundaries to support trading zone in Asia Pacific will certainly boost infrastructure and construction demand.

She also shared her views on specific metals like Nickel and Zinc, which she believes will remain firm due to supply shortages.Below is the transcript of Annalisa Jeffries's interview to CNBC-TV18's Manisha Gupta.Q: What is the latest trigger that you see in this space? We of course have been looking at the Trump rally which continues for metals. It also is about the statements from China now?A: Definitely we have got the Trump rally there. He talks about investing a trillion dollars in infrastructure and that has pushed up prices across all the base metal groups.We have also got a situation across all the metals from iron ore, steel and the base metals where we are heading into the winter season and there will be some pre-buying before the Chinese new year. So, you will see that increase in demand in advance. So we have seen some rises on all of the metals recently.Q: Would you agree that this is still sentiment and we really haven’t seen an actual demand or physical buying come into the markets. Are you slightly cautious about the kind of rally that we have seen?A: Yes and no because overall it has been an excellent year for China. If you look at steel demand overall this year, is really strong. You know there has been investment in house building in Shanghai and Beijing and that continues. So, if you look at the statistics on the import and export out of China, it is expected that production will be down by just 1 percent which is lower than earlier expectation. The drop was expected to be close to about 2 or 3 percent. So, that good demand continues. So, the scale and size of China just means that it has been an extremely good year.You have to also remember that Chinese government is going to be investing a lot itself in infrastructure as well. So, you have got what is happening in the US and you have got what is happening in China in terms of putting money into infrastructure and that's the key when it comes to the metals market.