Canadian commodity prices posted a sharp gain in March, say TD economists in the latest issue of the TD Commodity Price Report.

The TD Commodity Price Index surged 8% higher last month, with 11 of 18 commodities recording higher prices. A jump in prices for natural gas, crude oil and lumber led the way in March.

“The outlook for commodity prices is bright,” says Craig Alexander, Senior Economist at TD Bank Financial Group. “With the U.S. economy on the mend, global demand for raw materials is improving, suggesting that there is scope for non-energy commodity prices to build on their gains in the months ahead,” he adds.

Overall, the index is forecast to end this year almost 16% higher than in December 2001. The recent surge in energy prices is expected to be largely sustained, with the result that the energy sub-index will be up 28% from December-to-December. Non-energy commodity prices, such as forest products and base metals, are on track to record a gain of 11.5% over the twelve months of 2002. “The prospects for higher commodity prices are bullish for Canadian corporate profit growth,” observes Alexander.