PERTH (miningweekly.com) – Advisory firm Deloitte reported on Monday that the market capitalisation of Western Australia-listed companies making up its WA Index had increased by only 0.3% during May, to close the month at A$153.6-billion.

Deloitte said that commodity prices continued the trends observed in previous months, with steady gains seen across base metals, offset by uranium and iron-ore’s weak performances. Additionally, prices of precious metals, such as gold and silver, declined during the month as a result of a strengthening in the global equity markets.

“Although the local markets are feeling the impact from decreasing iron-ore prices, investors can still seek comfort from international equity markets, which have reacted positively this month on the back of positive economic data,” said Deloitte clients and markets partner for Western Australia, Tim Richards.

Iron-ore has experienced a double-digit fall in prices in May for the first time in two years as China’s central planning agency said the country’s period of high steel demand had passed, paving the way for reduced consumption levels. Prices tumbled by 13.1% and are attributed to higher output from suppliers coupled with high port inventories and weakened demand from China.

Uranium prices fell by 8.1% continuing the downward spiral owing to excess supply and discretionary demand in part owing to concerns about uranium’s demand outlook.

Meanwhile, nickel continued to lead base metal’s charge with a 5% increase, reaching its highest price in 16 months, amid sustained supply concerns as tensions rise over Russia’s intervention in Ukraine, and Indonesia’s continued nickel ore export ban, Richards said.

Richards noted that analysts believed the continued uncertainty in supply would continue to provide upward pressure on nickel prices in the short term, although price speculation also continued to play a role.

Platinum and palladium continued their upward trend from the previous month, posting gains of 2.8% and 4.1% over April as a result of supply disruptions in South Africa. The country’s production has been affected by labour disputes since January, shutting down key mines and adding to the most protracted shortfalls in global production since 2005.

Increases in the global risk appetite over improving US and European economic conditions pulled gold and silver prices to new lows, falling by 3.8% and 1.5% respectively over the month. Investors have been seeing less of a need to hold gold, traditionally a safe haven metal in times of political or economic uncertainties.