As China slows, commodities may feel outsize pain

By Tom Miles - Analysis HONG KONG (Reuters) - An unscripted slowdown in China's economy may take an exaggerated toll on commodity markets as demand from its construction sector and export-oriented manufacturers, which drove prices sky high, falls back to earth. As the financial crisis threatens to sink the global economy into recession, the question of China's future demand for oil, coal, copper and iron ore has taken on new importance for traders more accustomed to pricing in unstoppable growth. While no one expects its economy to slip into reverse, some analysts say even a slower-paced 6-8 percent expansion could have an outsize impact on demand for commodities, which China sucked in from around the world to turbo-charge its growth. "Commodities demand may slow faster than GDP for a period, depending on inventory levels and... [read full story]