A surge in demand from China could cause a bounce in commodities prices as restrictions on industrial activity around Beijing are eased after the olympics.

Vivek Tulpule, chief economist of the mining group RIO TINTO,which is due to announce half year results today,said the region affected by the restrictions ,which were introduced to try to improve air quality,contributes more than a quarter of China's gross domestic product.

The Olympics have accentuated the usual summer slowdown in commodities demand.When activity is allowed to start around Beijing,there will be a post Olympic jump.

Rio Tinto has rejected a take over offer from rival BHP-Billiton and while awaiting clarification from European regulators over whether a bid can proceed,both companies have stepped up efforts to highlight the long term value of their business.

He predicts that strong demand from China and other emerging markets will make up for weaker demand for commodities in the developed world.Despite the panic about falling metal prices,I am seeing very stong markets for 2009.

Mr Tulpule explained why Rio bellieves the six year metals bull market could last for another decade.THE SUPPLY of commodities is likely to be TIGHTER than the markets expects.A SHORTAGE of skilled workers and specialist mining equipment means that existing mining operations often face difficulty in INCREASING output.Supply will also continue to be DISRUPTED by strikes and power shortages,such as the blackouts that effected South Afric and China this year.

Hope this helps,

Inca.