A commodities buying spree in January by China's State Reserve Bureau helped halt a five-month decline in commodities prices, which rose 1.3%, according to Scotia Economics' latest Commodity Price Index.
The agricultural index increased 9.5% as the bureau built up reserves of key foodstuffs to support domestic farmers and as a hedge against the risk of sudden steep price hikes.
Patricia Mohr, Scotiabank's vice-president of economics, said China's imports of Canadian canola could more than double this year to two million tonnes, up from 960,000 tonnes last year.
Mohr added that China's canola sales could approach Japan's volumes by year's end.
The price paid for copper, zinc and other base metals also rose thanks to China's buying spree, which was aimed at increasing its inventories to support the country's smelting and refining industry.
Mohr said raw material demand will benefit from China's massive infrastructure program, which will spend more than $756 billion over two years to counter the decline in exports and private-sector investment.
Despite the optimism, however, the index is 38.2% below its peak in July 2008 and 19.6% below prices a year ago.