OREANDA-NEWS. The Metals & Mining and Fertilizer Conference, which was organised by Sberbank CIB1 , took place in Moscow. More than 300 participants, including representatives of over 120 metals and mining sector companies and members of the expert community and regulatory agencies, discussed the situation on global markets and the sector's development prospects.

Opening the conference, Alexander Bazarov, Member of the Executive Board and Senior Vice President of Sberbank, Co-Head of Sberbank CIB, emphasised the importance of the event, commenting: "The metals and mining sector is vital to Sberbank and accounts for a significant share of our loan portfolio - 17% or 1.7 trillion roubles. Regardless of whether you decide to buy or sell, optimise costs or spend, Sberbank is always here for you."

The first session "Looking for a new balance point, cleaning up excessive capacities" focused on global commodities markets. The moderator of the discussion, Julian Kettle, Vice Chairman, Metals & Mining, Wood Mackenzie, suggested that participants discuss the influence that the Chinese economy and other global factors have on the metals and mining industry and try to find new sources of growth.

Prior to 2010, metals prices increased by 2-6% annually. However, starting from 2011 growth turned into rapid decline. According to Avetik Chalabyan, Senior Partner, McKinsey & Co, the main reasons for this are the decline in residential construction and China's slowing economy. The expert predicted that in the near future consumption of all commodities will fall and global growth will only be possible if India and Middle Eastern countries become growth drivers.

Kevin Chen, Executive Director, FOSUN Mining, voiced the opinion that China is currently going through a transitional phase - over the past decade its economy grew too fast; now it is vital for China to change its growth, export and investment models, and carry out reforms, including in the metals and mining sector. This process will take time, and the downward trend is likely to continue in 2016.

Pavel Fedorov, First Vice President, Executive Director, Norilsk Nickel, is convinced that the market has seriously underestimated the institutional imbalances in the Chinese economy and that the current state of affairs on the global market is the result of excessive optimism. Financial markets are searching for new signals and experiencing a unique phenomenon - commodity reserves are decreasing in size and there is a metals deficit, yet prices continue to tumble. The speaker suggested that "time will cure the imbalances" and the "contradictory market" must return to a logical state in terms of fundamentals.

Participants of the second session "Macroeconomic environment in Russia: tailwinds and challenges for the domestic metals and mining industry" concentrated on the Russian economy.

The economy has overcome the "main shock". "All the prerequisites are in place for the manufacturing sector to improve its current position. Conditions need to be created which will allow Russian industry and domestic consumption to develop," concluded Gabriel Di Bella, Resident Representative in Russia, International Monetary Fund. Future growth will depend on internal and external factors, many of which are difficult to forecast.

The conference ended with themed panel discussions that covered steel, iron and coal production, the mineral fertilizers sector and the gold mining industry. CEOs of leading companies and representatives of the expert community and regulatory agencies exchanged opinions and discussed challenges and development strategies of Russian companies. The participants of the conference were also introduced to Sberbank's products during the panel "Instruments for managing a company's commodity price risk".