Should you buy these 3 ASX resources shares?

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With the global economy expected grow strongly over the next couple of years at least, I believe demand for commodities will remain robust and support favourable prices.

I suspect that this could lead to the resources sector continuing its outperformance for some time to come.

With that in mind, are these three resources shares in the buy zone?

Galaxy Resources Limited (ASX: GXY)

This lithium miner would have to be my number one pick in the battery materials industry. Although I thought its recent quarterly update was soft, I was pleased to learn that since then the company has been busy looking into options for its massive Sal de Vida asset in Argentina. Once operational, management believes this asset will provide significant cash flow generation for many decades. If lithium prices hold at these levels or even improve, then Galaxy will be positioned to deliver bumper profit growth for a long time to come.

OZ Minerals Limited (ASX: OZL)

Generally, when the global economy is on the rise, so too is demand for copper. As one of Australia’s leading copper miners, I think OZ Minerals could be a great option for investors looking to gain exposure to the resources sector. Especially if the miner is able to complete its acquisition of industry peer Avanco Resources Limited (ASX: AVB) in the near future.

Western Areas Ltd (ASX: WSA)

It isn’t just lithium that stands to benefit from the rapid growth of the electric vehicles market. Many lithium-ion batteries also include nickel in their cathode. So with nickel demand already outstripping supply, limited exploration projects, and demand from battery producers expected to increase, I believe the nickel price could remain at elevated levels for some time. This could make it worth taking a closer look at Western Areas.

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Motley Fool contributor James Mickleboro owns shares of Galaxy Resources Limited. The Motley Fool Australia has no position in any of the stocks mentioned. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

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