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Commodities set for bull run: Jim Rogers
Joyce Hooi
Wed, Jun 02, 2010
The Business Times

SUGAR could well be white gold, if veteran investor Jim Rogers turns out to be right.

Mr Rogers singled out sugar as poised for a bull run at the Asia Pacific Sugar Conference where he gave a keynote address yesterday.

'You will see sugar make an all-time high in this market sometime in the next decade,' he said.

Speaking to a packed conference room at Shangri-La Hotel, Mr Rogers noted that agricultural commodities are currently at an 'unbelievably low' price on a historical basis.

'Sugar is 75-80 per cent below its all-time high in 1974,' he said.

Oil, another commodity that he has tapped to soar in value, will also have a major effect on the price of sugar, he said.

'The surprise is going to be how high the price of oil is going to be and how high it's going to stay,' said Mr Rogers.

He was also bullish on agricultural commodities in general for Central Asia, Brazil and Africa.

'You're going to see a lot more turmoil in currencies and people who want to protect themselves will invest in real assets like commodities,' he said. 'Commodities are under-owned and under-invested.'

His view of other asset classes was a dim one.

'I have very few investment in stocks and none in bonds. If any of you hold bonds, I would advise you to go home and sell them. It's a very bad place to be,' he said.

While Mr Rogers might currently be holding some US dollars in his basket of currencies, he does not hold an optimistic view of it over the long term.

'The US dollar is a terribly flawed currency and is being debased at a rapid rate. The US is the largest debtor nation in the history of the world,' he said.

China and the Asian region in general, however, were a whole other matter, being among the largest creditors in the world, Mr Rogers pointed out.

Tai Hui Cheung, Standard Chartered's regional head of research, South East Asia, was not fazed by the slowndown in China's growth rate.

'I'm not concerned about the slowing of growth in China. It's much better for the economy to improve at 7-8 per cent over the long term instead of moving at 12 per cent,' said Mr Tai during his keynote speech at the conference which was organised by Kingsman and supported by Queensland Sugar Limited.

Some concerns for the region over the next few years could emerge in the form of inflation, Mr Tai cautioned.

'Asia could see rising inflation and commodity prices could have more influence on general inflation in the region in 2011 and beyond.'

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