SINGAPORE (Commodity Online): Gold price may be hitting the roof these days. But globally renowned economic analyst and legendary commodities investor Jim Rogers says the price of another commodity will begin to soar soon: rice. "Rice is the staple food of much of the world. Rice price is going to skyrocket," Rogers said.
Rogers, now based in Singapore and who is a big investor in the agri commodities, especially in China, said in an interview this week that he will not touch surging commodities like gold and silver these days. He said gold price is going to skyrocket, and thus it is not the right time to invest in precious metals right now.
Rogers, author of celebrated books like
Hot Commodities and
A Bull in China, said that rice and cotton prices are likely to soar in the coming decade as prices of agricultural commodities boom because of declining inventories and production disruptions.
He continues to believe that the global investment action is now on China. He continues to be a firm believer that China is the place to invest and the best thing to invest in China is commodities.
Rogers, who shifted his home from the United States last year to invest wisely in the Asian countries with his main focus on China, is pumping in lots of money into Chinese markets.
If we start having problems — weather problems, production problems — the price of rice is going to skyrocket over the next decade,” Rogers, 66, who predicted the start of the commodities rally in 1999, said. “When it happens, I don’t know. But I know that the fundamentals are ripe.”
Rice, wheat, corn and soyabeans climbed to records last year on concern that production was lagging behind demand, sparking riots from Haiti to Ivory Coast.
Prices dropped as farmers planted more, helping to replenish stockpiles. Agriculture production needs to expand by 70% through 2050, as the global population rises to 9.1 billion from 6.7 billion, Jacques Diouf, director general at the United Nations Food and Agriculture Organisation, said on October 12.
“Global agriculture will have to cope with the effects of climate change, notably higher temperatures, greater rainfall variability and more frequent extreme weather events such as floods and droughts,” Mr Diouf told a food forum in Rome.
Rice stockpiles of the world’s five largest exporters are forecast to plunge by a third to the lowest level in five years as output in India, the second-largest grower, declines because of drought, Concepcion Calpe, senior economist at the Food and Agriculture Organisation (FAO), said last week at a conference in Bali. Global Staple
“Rice is a basic food stuff for much of the world,” Rogers said added: “We know that inventories are low. I would not buy rice today necessarily. But I expect rice prices to be much higher over the next decade.”
In 1998, Rogers launched the Rogers International Commodity Index, a composite, US dollar-based, total return index, designed to meet the need for consistent investing in a broad based international vehicle. The Index represents the value of a basket of commodities consumed in the global economy, ranging from agricultural to energy to metal products.
