Given the strong links of this economy with the fortunes, or otherwise, of commodity cycles and trends, many South Africans will be interested in a new piece of analysis by Barclays. It shows that not all commodities will lose out should China succeed in transitioning to a growth model underpinned increasingly by domestic consumption and decreasingly by resources-intensive infrastructure investments and exports.

China’s twelfth five-year plan, endorsed in March, prioritises such a rebalancing in the interests of economic sustainability.

But it is also behind much of the prevailing poor sentiment in the commodity market, owing to a feeling that such a major structural adjustment will definitely affect demand for natural resources, both mined and farmed.

However, Barclays, which admits to be more bullish than many of its peers in the outlook for resources, argues that the picture is far more nuanced.

Its June analysis shows that the usage intensity of several commodities, including petrol, nickel and aluminium, could in fact grow as a result of China’s proposed transition.

By contrast, silver, platinum and several agricultural commodities are seen to be vulnerable, while the usage- intensity downside for commodities such as coal, steel, copper and zinc is expected to be modest.

Add into that mix the possibility that China’s transition might not follow a smooth trajectory, with potential still existing for the country to revert to infrastructure spending should growth and job creation come under serious pressure, and the picture becomes even more complex.

In 2012, China’s growth slowed to 7.8%, the slowest pace in 13 years and, in late May, the International Monetary Fund lowered its forecast for China’s growth to 7.75% for 2013, having previously forecast growth of 8%.

There has also been a slew of lower-than-expected economic data released for the month of May, resulting in some banks lowering their growth forecasts for the world’s second-biggest economy. In addition, there has been a slowdown in commodity imports.

Nevertheless, Barclays believes the poor performance of commodities is being driven more by cyclical factors than by structural issues, including China’s economic shift and perceptions that the supply-side risks have dissipated. Commodities have performed poorly historically when growth and interest rates are low.

Once the fog lifts, there could well be material divergence in the price performance of individual commodities as the focus shifts to individual commodity fundamentals. Unhappily, though, many of the commodities that are seen as most vulnerable to the transition are commodities in which South Africa has a dominant position, including platinum.