For years, China was the story. You didn’t need to overthink it: if Beijing was building, commodity prices were flying. Iron ore, steel, coal: it was all about feeding the Chinese growth machine. But the times, they are a-changing.

China’s still huge, it’s just not growing like it's in economic puberty anymore. And that shift means commodity investors need to start thinking a little differently about where the next leg of demand is coming from.

As the brilliant and sage chief economist Michael Knox from Morgans put it on this week's episode of Switzer Investing TV:

“China is a very large economy. But I think it’s only going to grow at about 3% to 3.5% this year — much less than the 5% they want to hit.”

That’s a long way from the breakneck double-digit growth rates that powered global markets for decades.

The rise of Asia’s ‘new Chinas’

But here’s the good news: while China slows, Knox says the broader Indo-Pacific region is starting to pick up the slack:

“Chinese growth has fallen below the growth rate of Vietnam. Vietnam is now growing at about 7%. India, of course, is growing at about 6.2% to 6.5%. So there are now higher-growth economies than China.”

That’s good news if you’re selling steel, iron ore or energy. Someone still wants it, it’s just no longer concentrated in one buyer.

“They export a lot of steel to Vietnam, a lot to the Philippines, a lot to South Korea, and an enormous amount to Indonesia — because now they’re building the same kinds of big cities that China was building up until recently,” Knox said.

In other words: the building boom never really stopped — it just moved address.

Expect steady demand, slower cycles

So what does this mean for prices? This is where Knox gets very clear.

“I think we’re actually just past the bottom in commodity prices for this cycle. I think we’re going to see steady rises over the coming years. But they’ll be more gradual than what we saw in the big post-pandemic boom cycles.”

Translation: don’t expect another 2021-style commodity rocket ship. Prices may keep rising, but in a more controlled, sustainable way as demand spreads across multiple economies instead of being totally tied to China’s infrastructure spending.

And that has flow-on effects for companies like BHP and Rio Tinto. Their profits will likely stay solid, but probably without the kind of explosive windfalls that made headlines during China’s early growth surge. The upside is that a broader, more stable regional demand base may actually reduce some of the extreme boom–bust cycles that have plagued commodity markets in the past.

In a sense, this is China’s coming-of-age moment on the global stage. It’s no longer the scrappy emerging economy sucking in half the world’s resources — it’s now the heavyweight that dictates trade flows, price floors, and increasingly shares the growth spotlight with its regional neighbours. Don't believe me? Ask Donald Trump how his negotiations are going.

If you’re betting on commodities today, you’re not betting on one economy anymore according to Knox. You’re betting on Asia as a whole, and that’s not a bad place to be.