JOHANNESBURG (miningweekly.com) - Although economic conditions have stabilised over the last three months, the true underlying demand for commodity products would not be visible before 2010, BHP Billiton CEO Marius Kloppers said on Wednesday.

Kloppers said that, after the collapse of commodity prices last year, there had been a rebound and the velocity of recovery in China had been positively surprising.

He said that the extent to which the Chinese recovery was the result of pent-up demand from a much-depleted inventory chain, or real demand, now had to be determined.

"It's our view that restocking in China is essentially complete," he said.

The steel-capacity usage rate was starting to climb once more, which was the first evidence that restocking had commenced in the US and Europe and Japan, in the latter two a little earlier than anticipated.

But, he cautioned that metals-intensive nature of the developed economies of the US, Europe and Japan were lower than developing economies.

He said that the absolute impact of the Chinese restocking would be greater than that of the developed world's restocking, with the US, in particular, being considerably lower because of its self-sufficiency in materials used for making steel.

Although it would not be until 2010 before underlying demand would become clearly visible once more and not masked by inventory effects, BHP Billiton did expect a more predictable demand scenario in the coming financial year.

It continued to be the company's view that it would emerge from the recession less strongly than it had emerged from previous commodity cycles.

To subscribe to Mining Weekly's print magazine email subscriptions@creamermedia.co.za or buy now.