XSTRATA chief Mick Davis believes the medium-term outlook for commodity demand remains ''very promising''.
Mr Davis (pictured below) was speaking at the release of Xstrata's 2009 profit report, which showed scars caused by the lingering effects of the global financial crisis on commodity prices and demand.
Xstrata, a big coal, copper and nickel producer from Australian operations, reported that its attributable profit plunged 41 per cent from $US4.69 billion to $US2.77 billion ($A3.19 billion).
Xstrata began the profit reporting season for global miners and will be followed tomorrow by BHP Billiton (December-half profit) and Rio Tinto on Thursday (annual result).
The market will be keen to see whether BHP chief Marius Kloppers and Rio boss Tom Albanese echo the bullish outlook from Mr Davis.
Mr Davis said that the group's profit slump was a creditable result given the sharp downturn in early 2009.
"In my opinion, the medium-term outlook for commodity demand remains very promising, driven by the ongoing urbanisation and industrialisation of high-growth, populous economies, with China and other industrialising countries taking active steps to rebalance their economies towards domestic consumption-led growth over the next decade,'' Mr Davis said.
''There are a number of risks that must be carefully managed on the path to a sustainable OECD [Organisation for Economic Co-operation and Development] recovery.
''However, many of the short and medium-term leading indicators we monitor are showing signs of recovery.''
Xstrata has shifted its focus from a group dominated by growth by acquisitions to one focused on growth from internal expansion and new projects.
It has backed its confidence by declaring a final dividend of US8¢ a share (nil previously).
