INTERVIEW-German govt agency to advise firms on commodities

Published 10/07/2010, 07:40 AM
Updated 10/07/2010, 07:44 AM
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* Sending companies questionnaire to determine requirements

* Agency to be built in stages, reach full operation 2013/14

By Michael Hogan

HAMBURG, Oct 7 (Reuters) - A new commodity advisory agency set up by the German government will help the country's industry find raw material supplies and will seek more international cooperation with supplier countries, its director said on Thursday.

German Economy Minister Rainer Bruederle this week officially opened the Hanover-based agency, which will be operated by the Federal Institute for Geosciences and Natural Resources. He said the agency was part of efforts to secure raw material supplies for Germany, Europe's largest economy, in the face of intensifying global competition for commodities.

Consumers in many industrial countries have noted with concern how commodity-hungry China has been buying up supplies, especially with major deals with Africa. This has created uncertainty about future supplies of a range of metals and ores needed for industrial output.

Agency director Volker Steinbach said advisory services to industry would be provided, with a special focus on helping small and medium-sized companies find sufficient raw materials.

"In the summer we undertook intensive talks with industry associations and with individual companies and we are currently sending a questionnaire to German industry to determine their exact requirements," Steinbach said.

The agency will then be built up in stages, with full operations expected in 2013/14 and its exact form depending on industry needs.

FIVE MODULES

Currently five modules are planned. One will be a commodities information system based on the institute's existing data banks.

"This will show the availability of mineral and energy resources, where the reserves are, where mineral resources are mined, what is the demand from individual countries or if there are market concentrations in order to achieve more transparency in the global commodity situation," Steinbach said.

"We will also inform users when new raw materials reserves are found."

A second module will actively answer specific questions from German industry about commodities availability.

"It may be that companies are interested in investing in commodities producers and may ask where there are interesting potash, iron ore or copper or zinc projects."

"It may be that small and medium-size companies will want their raw materials supplies to be assessed in terms of whether their requirements could face critical supply bottlenecks."

"It may be that they consume copper, lead or zinc, which may not face serious supply issues, but also rare metals which could face supply problems."

"We could then be able to recommend that they diversify supply sources, seek alternatives or develop substitute special materials if foreseeable supplies are not sufficient for their needs."

Other planned modules will handle research into possible themes such as enrichment or new sources of commodities from wastes and will support German government commodity support programmes.

Another module will seek cooperation with commodity-rich countries. "This will seek to bring together and strengthen cooperation between commodity users and the miners and producers in these countries to achieve improved supply security," Steinbach said.

Maintaining German policy on human rights, environmental protection and sustainability will be a feature of such cooperation especially with developing countries, he stressed.

The agency is ready to analyse all commodities, he said. The initial focus is likely to be on minor metals and ores especially needed for high-technology products.

"The agency has decades of experience in commodities and the aim is to make this widely available to German industry," he said.

(Editing by Jane Baird)

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