New York: Raw materials may return more than financial assets for the first time in three years as the global economy rebounds, according to Bloomberg surveys and 2009's most accurate commodity forecasters.
Oil, corn, gold and palladium will advance as much as 17 per cent this year, the analysts said. The S&P GSCI Enhanced Total Return Index of 24 commodities will gain 17.5 per cent, Goldman Sachs Group Inc. estimates.
That will beat the 11 per cent jump in the Standard & Poor's 500 Index and the 2.8 per cent return on the benchmark US 10-year note, forecasts compiled by Bloomberg show.
"Demand is growing on a global basis," said Peter Sorrentino, who helps manage $13.8 billion (Dh50.75 billion) at Huntington Asset Advisors in Cincinnati and predicted the collapse in prices in 2008.
"Commodities are a great place to be to gain exposure to the growth that's coming out of emerging markets," Sorrentino added. Sorrentino's largest commodity holdings are in coal and natural gas.
Commodities will keep rising after the Reuters/Jefferies CRB Index's best year since 1979 because China is leading the world out of the first global recession since the Second World War.
Peoples' Bank of China Governor Zhou Xiaochuan said last Thursday that the central bank will keep its monetary policy "moderately loose" after the government's $586 billion stimulus increased demand for Australia's coal, Brazil's iron ore and Chile's copper.
Expansion forecast
The 3.1 per cent global expansion forecast by the International Monetary Fund (IMF) in October also means demand for food will rise.
A United Nations (UN) index of 55 food commodities advanced for four consecutive months through November. Shortages sparked riots from Haiti to Egypt in 2008.
Commodities are forecast to beat bonds and stocks this year as faster growth and higher prices stoke expectations that central banks will raise interest rates to curb inflation.
Goldman forecast last Thursday that the S&P GSCI Enhanced Total Return Index would gain 17.5 per cent in 12 months.
