Commodity Investor Q&A: Is Jim Rogers Right In Buying Agricultural Commodities?
With Matt Badiali Q: Do you think Jim Rogers is right to be buying agricultural commodities now? – A.M. A: Legendary commodity trader Jim Rogers recently told Bloomberg viewers that farmers, not brokers, would drive Lamborghinis. He also told the host to start up a Bloomberg farm show… His argument is simple: Farmers can no longer get loans for fertilizer, so supplies of most crops are down. However, demand for those crops, like cotton and soybeans, is actually rising. That means prices must rise. Rogers’ record on “soft” commodity investing is pretty impressive. In 2004, he published Hot Commodities, focusing specifically on sugar and coffee. Both were ideal commodity trades: There wasn’t enough supply to meet demand. In January 2004, coffee sold for 70¢ per pound and sugar just 6¢ per pound. As you can see from the chart below, prices rose steadily over the next few years. Coffee peaked at $1.78 per pound and sugar peaked at 20¢ per pound. That represents gains of 155% and 232%, resp
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