The scale and speed of demand growth from
emerging countries, coupled with a decade of tight commodity
markets, has created the current period of intensified
resource stress, the report, published by London-based
think-tank Chatham House, said.
The outlook is one of supply disruptions, volatile
prices, accelerated environmental degradation and rising
political tensions over resource access, according to the
It noted that some analysts have suggested that the
resource boom that took place over the past decade
was coming to an end, because of the maturation of technologies
to access non-conventional gas and oil and of the global
In the case of food, the world remains only one or two
bad harvests away from another global crisis, the report
Lower prices in the meantime may simply trigger
another bout of resource binge, especially in the large and
growing developing countries.
The report said the growth of China and India, both as
consumers but also as producers, affected many resource
markets, adding that over the last 10 years, global use of
coal, palm oil and iron ore has been increasing by between 5%
and 10% per year, with oil, copper, wheat and rice growing by
2% a year.
In weight terms, trading in resources jumped nearly 50% from
a decade ago due to the expansion in trading of oil, iron and
steel, coal, oilseeds and cereals all feedstocks
for China, the factory of the world, it said.
A wave of other developing countries, likely to include Iran,
Turkey, Thailand and Vietnam, will become important resource
consumers in the next 10 years, according to the report.
High and fluctuating prices are spurring new waves of
resource nationalism and making unilateral and bilateral
responses more attractive, it said, giving the example of
export controls on food in producer countries, which were
intended to prevent sharp domestic price inflation in 2008 and
2011 but ended up magnifying price spikes.
It noted that a number of key raw materials suppliers such
as China, Indonesia, Brazil and India have either resorted to
export controls or were considering them.
However, even short-term export restrictions may
backfire if they precipitate similar actions in other producing
countries, driving up prices and creating a collapse in
confidence that spreads from one resource to another, the