Australian miners such as BHP Billiton and Rio Tinto and the country's steel industry are to be affected by the weaker metal demand in China for 2012.

Wang Huajun, deputy secretary-general of the China Nonferrous Metals Industry Association, forecast that metal demand in China is expected not to grow beyond 10 per cent in 2012. At the same time, he said that non-iron ore metal prices would also go down in the next 12 months.

China's demand for metals will impact metal-producing nations such as Australia because China is the largest purchaser of copper and iron ore in the world and is the third largest buyer of alumina.

The slower Chinese demand has actually started in 2011 which placed pressure on metal prices and caused it to drop 23 per cent this year at the London Metal Exchange LMEX Index, its first decline in price in three years.

Besides weaker demand in China, analysts said the possible dissolution of the European Union may also impact global metal demand in 2012.

However, Mr Wang forecast higher demand for refined copper by 6 per cent, aluminum by 8 per cent, lead by 7 per cent and zinc by 5 per cent.

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