Driven by demand from China, price trends for 32 of Canada’s major exports rebounded by 0.9% in October to a level 21.2% above a year earlier, Scotiabank’s commodity price index shows.

The oil and gas index soared month-over-month by 12.4% with both light and heavy crude oil prices climbing to a record high and natural gas export prices and propane prices snapping back from temporary declines in September.

West Texas Intermediate crude oil prices have recently eased back into a US$46-48 per barrel range, after reaching a record high of US$55.17 in late October. However, tight U.S. home heating oil supplies will likely keep prices at a high level in coming months.

The metal and mineral index jumped significantly, reaching the highest level since April 1989. It rose 4.5% month-over-month, and is likely to strengthen further over the next six months.

The agricultural index also edged up in October, as No.1-grade milling wheat strengthened.

These increases more than offset a sharp 11% month-over-month drop in the forest products index.

“While G7 industrial activity slowed significantly in the third quarter (especially in Japan, the United Kingdom and Germany), renewed strength in China’s business fixed investment and stepped-up buying of copper by China lifted overall base metal prices to their highest level for this business cycle,” said Patricia Mohr, vp and commodities specialist, Scotia Economics, in a release.

“Though a further drop in lumber and OSB prices and recently softer crude oil prices will create strong headwinds for the All Items Index in November, Canadian commodity producers and investors can look forward to further price gains for coking coal, iron ore, uranium and ‘groundwood specialty’ papers in the next six months. The rise in coking coal prices from Western Canada to Japan and other Asian markets in the new contract year, beginning in April 2005, is likely to be spectacular,” she added.