Global commodities boom led by China
Sunday, 3 January 2010
BEIJING, Jan 02 (Commodity Online): Commodities have outperformed stocks in the last one decade and the country that is leading the commodities boom rally is China.
There is a rush to investing in commodities in China these days that people are investing in all kinds of commodities-garlic, wheat, gold, silver, platinum, palladium. Global commodities investing guru Jim Rogers has been asking people to put their money in agricultural commodities, especially in countries like China.
"China is spurring the commodities boom globally. Investments into commodities sector will soar in 2010 as food prices are going up and there is an increased demand for agricultural commodities from Middle East and the American countries," says noted commodities analyst Mark Robinson.
According to a recent Bloomberg survey, commodities posted the biggest annual gain in four decades, led by a doubling in copper, sugar and lead prices, as Chinese demand compensated for the longest slump in the global economy since World War II.
"In 2009, the S&P GSCI Index of 24 raw materials rose 50 per cent, the most since at least 1971, and commodities drew record investment of $60 billion this year, Barclays Capital estimated. This year, the MSCI World Index of stocks in 23 developed nations climbed 27 per cent, and US Treasuries fell 3.5 per cent, according to Bank of America Merrill Lynch indexes," said the survey.
Here are the main points from the Bloomberg survey:
China, the biggest consumer of commodities such as copper and iron ore, expanded 8.5 per cent this year. China imported record amounts of both raw materials this year, making up for slack demand in the US and Europe.
In 2009, the Reuters/Jefferies CRB Index of 19 raw materials advanced 23 per cent, the most since 1979.
China's central bank will maintain a "moderately loose" monetary policy because 2010 will be a crucial year for strengthening the recovery.
Among industrial metals traded in London, lead posted the biggest gain. Since the end of 1999, the metal more than quadrupled, leading gains among 36 exchange-traded raw materials in the US, Europe and Asia. Copper also doubled this year, leading gains in the CRB gauge. The metal climbed almost fourfold in the decade.
Lead for delivery in three months rose $21, or 0.9 per cent, to $2,432 a metric ton today on the London Metal Exchange. Copper gained 0.6 per cent to $7,375 a ton.
In 2009, gold futures in New York rose 24 per cent, the ninth straight annual gain. The dollar's slump spurred demand for precious metals as an alternative investment.
Crude oil advanced 78 per cent this year. The Organisation of Petroleum Exporting Countries, accounting for 40 per cent of global supply, reduced output in response to the worldwide economic slump.
Raw-sugar futures in New York more than doubled this year, trailing only copper's advance in the CRB index. Cane harvests in Brazil and India, the biggest producers, were hurt by adverse weather.
There is a rush to investing in commodities in China these days that people are investing in all kinds of commodities-garlic, wheat, gold, silver, platinum, palladium. Global commodities investing guru Jim Rogers has been asking people to put their money in agricultural commodities, especially in countries like China.
"China is spurring the commodities boom globally. Investments into commodities sector will soar in 2010 as food prices are going up and there is an increased demand for agricultural commodities from Middle East and the American countries," says noted commodities analyst Mark Robinson.
According to a recent Bloomberg survey, commodities posted the biggest annual gain in four decades, led by a doubling in copper, sugar and lead prices, as Chinese demand compensated for the longest slump in the global economy since World War II.
"In 2009, the S&P GSCI Index of 24 raw materials rose 50 per cent, the most since at least 1971, and commodities drew record investment of $60 billion this year, Barclays Capital estimated. This year, the MSCI World Index of stocks in 23 developed nations climbed 27 per cent, and US Treasuries fell 3.5 per cent, according to Bank of America Merrill Lynch indexes," said the survey.
Here are the main points from the Bloomberg survey:
China, the biggest consumer of commodities such as copper and iron ore, expanded 8.5 per cent this year. China imported record amounts of both raw materials this year, making up for slack demand in the US and Europe.
In 2009, the Reuters/Jefferies CRB Index of 19 raw materials advanced 23 per cent, the most since 1979.
China's central bank will maintain a "moderately loose" monetary policy because 2010 will be a crucial year for strengthening the recovery.
Among industrial metals traded in London, lead posted the biggest gain. Since the end of 1999, the metal more than quadrupled, leading gains among 36 exchange-traded raw materials in the US, Europe and Asia. Copper also doubled this year, leading gains in the CRB gauge. The metal climbed almost fourfold in the decade.
Lead for delivery in three months rose $21, or 0.9 per cent, to $2,432 a metric ton today on the London Metal Exchange. Copper gained 0.6 per cent to $7,375 a ton.
In 2009, gold futures in New York rose 24 per cent, the ninth straight annual gain. The dollar's slump spurred demand for precious metals as an alternative investment.
Crude oil advanced 78 per cent this year. The Organisation of Petroleum Exporting Countries, accounting for 40 per cent of global supply, reduced output in response to the worldwide economic slump.
Raw-sugar futures in New York more than doubled this year, trailing only copper's advance in the CRB index. Cane harvests in Brazil and India, the biggest producers, were hurt by adverse weather.