Turning The Corner?

Jim Rogers was quoted yesterday saying.. “As far as commodities are concerned, it’s about supply and demand, and you’re having huge cutbacks in supply. We’re already having supply problems in some agricultural products and we’re going to have problems with oil products. “So I don’t think that the bull markets in commodities have gone away forever, because supply is going to be an [issue]. You can have a bull market with flat demand or even declining demand if supply is not there,” he said. Asked about the time-scale for a recovery Rogers re-iterated his views on farming output and crude oil thanks to “frackers going out of business”, but said due to the “massive expansion” of iron ore supply low prices may be around “for some time”. We agree. It is all about supply and demand – across a value chain. It’s possible to have a glut of crude oil, limited refining capacity and supply pressure on refined products, for example. While the news on commodities is ‘doom and gloom’ at the moment, let us not forget that it’s not that simple – it never has been.

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