Foreword
COMMODITIES ARE ON a tear once again – or should that be ‘bubbling’ once more ... Many commodities have entered a new phase of the current cycle. Investors are holding their biggest positions on record in commodity markets as prices surge. At the same time US and EU regulators particularly are at odds as to how to shape legislation to curb excessive speculation without hampering (and making more costly) hedging for producers and consumers of raw materials. Investment funds have dramatically ramped up their holdings in
the last 18 months. In many cases, the number of contracts held for individual commodities now far exceeds the amount outstanding
in mid-2008, the last time commodity markets were soaring to records and debate raged about whether a bubble market was developing (it was). Defining bubbles is difficult. We had one earlier this year (and now again presumably) in sugar.
Then cocoa. Soon to follow came tea, cotton etc. Agricultural bubbles are, however, quite different to excessive prices in other parts of the complex. All the precious metals have seen stellar gains also and for quite different reasons. Base metals too have revived dramatically and the just announced physically backed ETCs (see page 74) look likely to put a floor on prices and increase volatility even further. Even oil, we are told, is set to hit $100/bbl “imminently”. Easy (some say reckless) US monetary policy and a currency crisis in the Eurozone are aiding and
abetting this rally in raw materials because investors are rightly concerned about fiat money. The Chinese are also the undeniable major demand source being the single largest importers of most raw materials. But none of this is particularly new news, so why the continuation in price moves? In the pages that follow we show you why.
Best wishes and Season’s Greetings from all at Isherwood Production. Guy Isherwood, Publisher/Editor.
I AM TOLD I am a lot of things, but recent events have taught me that, in the lavish dinner party-giving sense of things, I’m no Martha Stewart. However, something I am rather good at is knowing my shortcomings and delegating when necessary. It struck me early on that planning a champagne reception, three course meal and general all round night out in the city for close to 150 people for our inaugural Commodity Business Awards last month was just such a “when necessary”. Short of adding ‘mastering the foxtrot’ to the equation, I couldn’t have been more out of my depth. So, I’d just like to take this opportunity to thank all those involved in making the Awards such a great success. And it was not just the ceremony that was a success of course, but
the whole process from start to finish. With over 14,500 votes, this year’s Awards were an unequivocal triumph and we can’t wait to get started on next year’s ceremony. Of course, I am still smarting about the fact that I missed out on
See Page 20
the bespoke Savile Row suit in the charity raffle – even though I am told they only tailor for “gentlemen”. I actually did win a prize though – ironically, a book on options trading which, in my new role as a mother is about as much use as a chocolate teapot. Come
to think of it, I’d never have read it when full time in the office. Go to page 20 to see the list and rankings of the winners of this year’s Awards and look forward to a phone call from my Editor in about 6 months time to get involved in the 2011 Awards Programme.
Best wishes, Charlotte Sones, Advertising Manager. December 2010 1
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