Lead and soybeans poised to rise as most commodities fall and global equities tumble

Diversification is key to allocating your risk when investing.  If you’re in equities and commodities (precious and non-precious metals, energy or agriculture) you have probably seen your portfolio take a serious in the past few weeks.

Two commodities however, seem poised to buck this trend, as Bloomberg reports in these two separate pieces on lead and soybeans.

You can click the article titles or the links below the excerpts posted here to read each respective report in its entirety.

Lead Shortage Looms in ’13 on Record Demand for Batteries - Bloomberg

Lead is poised to rally after erasing this year’s gains with the market returning to shortages following a five-year glut as miners fail to keep pace with record demand for batteries.

Stockpiles monitored by the London Metal Exchange dropped 7.6 percent from the all-time high reached in October. Demand will exceed supply by 150,000 metric tons next year, equal to about six months of U.S. mine production, Macquarie Group Ltd. estimates. Prices will average $2,273 a ton in the fourth quarter, 13 percent more than now, according to the median of 18 analyst estimates compiled by Bloomberg.

Click here to access the full article direct from Bloomberg

Soybeans Rise From Six-Week Low as Biggest Growers’ Exports Gain - Bloomberg

Soybeans rebounded from a six-week low as export sales from the U.S. and Brazil climbed, draining supply in the world’s two largest growers.

The amount of soybeans inspected for U.S. export almost doubled in the week to May 10 to 20.3 million bushels from the prior seven days, the Department of Agriculture said yesterday. In Brazil, growers had sold 83 percent of the harvest as of May 11, up from 63 percent a year ago, according to researcher Celeres.

Click here to access the full article direct from Bloomberg

Double standards – The US in the Americas vs the US in ASEAN

Article written by Bennett A. Reiss Iberico

Author, creator, web master, and manager of ChinaSouthAmerica.com

With all the news coverage of the recent Summit of the Americas in Cartagena, Colombia focusing on the CIA’s love of prostitutes it’s a tragedy the issues of the summit aren’t being covered – namely how every nation in the Western Hemisphere, except for the US and Canada expressed their desire to invite Cuba to the summit which the US/ Canada would hear nothing of. Both emphasizing that in order to participate in the summit, or any regional club within the “Americas,” a country must be a Democracy.

Consider this in the context of how the US acts and willingly desires to participate in ASEAN summits of SE Asian nations. All this talk from the Obama Administration and Republican Candidates about the strategic importance of Asia/ the Pacific on the surface makes it an easy story to sell by the media. ASEAN is a club of nations with extreme strategic importance for the US in Asia, and a means in which to protect US interests in the region and check China’s rising influence.

Let me remind the world (readers of this article/ website), ASEAN includes countries such as:

Vietnam – A Communist Country
Laos – A Communist Country
Cambodia – An Absolute Monarchy (arguably in transition to a Constitutional Monarchy or Democracy)
Brunei – An Absolute Monarchy

So it’s okay to talk, trade, forge geo-political and military ties with nations in this group in ASIA… but when we talk about the “Americas,” (North and South America), the same standards don’t apply? Why do we listen, give attention and forge ties with these nations mentioned above that are not “Democracies,” and thereafter shut the door on Cuba? Perhaps it has something to do with the wealthy Cuban Lobbyists’ in Miami…

Food for thought, although unfortunately it is a topic no major media outlet around the world feels is worthy to address, question and bring to people’s attention.

~ Bennett A. Reiss Iberico

Para todos los hablantes de la gran lengua española

Para todos los hablantes de la gran lengua española con raíces que se remontan más allá del idioma Inglés, que el teatro de pan en el mismo nivel de Inglés hizo, una edad de oro de la literatura española, que hemos ganado varios premios noble de nuestras poetas y novelistas, etc .. Denouce este racista, ignorante, gordo marshmello de mierda – NEWT GINGRICH.

Pasa, retweet, etc — esta publication a todos sus amigos y socios por el mundo de hablantes de espanol para podemos aprovechar el fuerzo de social networking. El gol — que en algunos semanas tenemos latinos no solo por los eeuu pero por todo latinoamerica que sepan que racista que es este huevon en realidad.

http://newsone.com/nation/associatedpress3/newt-gingrich-called-spanish-language-of-living-in-the-ghetto/?fb_ref=post

South Park – The Last of the Meheecans

Img: Courtesy of Comedy Central (Viacom)

Reality? No… but no less entertaining and ripe with “subtle messages.”  I also recall reading in roughly late Aug/ early Sept a headline scroll on the bottom of Boomberg TV — “Mexicans buy back Texas, flock to real estate markets as housing prices drop and the Mexican Peso continues to appreciates.”

If you like satire mixed with crude, over-top humor about current events… particularly US Domestic Immigration Policy and the state of the US Economy, definitely check out this link to the latest episode of South Park.

This is scary… and not for the obvious reasons

This is scary because when all is said and done, it instills fear in the minds of the average American when it comes to China.  Meanwhile, the average Chinese person I speak to on the streets of China love and respect US-Americans.  Instead of focusing on what the US as a country needs to do to revitalize itself, we are instilling fear and placing blame on a country we are inherently linked to the hip with economically. Silly and sad.

We should be fostering friendship, cooperation, exchange… yes on a equal footing, and one which America stands its ground and shows it a benevolent and humble world power.  Not a desperate, bitter, power in demise.

Here are a collection of links to other videos, just as bad if not worse.

Moved

His own words

Made in China

A Foreign Worker’s Best Friend

Colombia says “NO” to the U.S. armed forces

Bloomberg News reports that Colombia’s Constitutional Court blocked an accord that grants U.S. armed forces access to several military bases in the country because it wasn’t approved by the legislature.

The court, in a 6 to 3 ruling last night, said the agreement is not covered by any international treaty, as former President Alvaro Uribe had argued. The year-old agreement to allow U.S. personnel and equipment inside seven bases prompted Venezuelan President Hugo Chavez to freeze trade ties with Colombia and order troops to their shared border.

Click here to read the entire article from Bloomberg

The quest for energy resources — CNN Video

CNN Video — Militants agree to stop attacks. Nigeria’s oil minister tells CNN China and U.S. are vying for their oil.

Commodity Boom Will Thrive on Shortages, Rogers Says

Newswire: Jim Rogers

“I don’t see any adequate-supply situation in any commodity market over the next decade or two,” Rogers, the chairman of Singapore-based Rogers Holdings, said today in an interview in New York. “The commodities boom is not over and the bull market has several years to go.”

“I own some cotton,” Rogers said. “I own some sugar,” he said. “Sugar will go much, much higher over the course of the bull market.”

“Oil could reach between $150 and $200 a barrel,” because known reserves of crude are declining, Rogers said. He said international relations, particularly between the U.S. and Iran, will help guide prices.

“Natural gas is very cheap,” he said in the interview between sessions at an ETF Securities Ltd. investor conference.

Commodities ‘Best Place’

“Commodities are the best place to be, if you ask me, based on supply and demand,” Rogers said. He said he hasn’t invested in equities outside of China in two years.

“Everything has gone through the roof,” Rogers said of equities prices, adding that he may consider buying stocks “if something collapses.”

Click here to read the complete Bloomberg article

Newswire: Commodities

China Nurtures Futures Markets in Bid to Sway Commodity Prices - WSJ

ZHENGZHOU, China — Chinese leaders are concerned that their nation’s enormous economic expansion is becoming an excuse for foreign suppliers to inflate commodity costs. So, they hope to use their three futures exchanges to fight back.

“It is true we have a long-term goal of increasing our influence in terms of pricing, but to do that we have to create conditions and do it step by step,” Jiang Yang, chief futures-industry policy maker and assistant chairman of the China Securities Regulatory Commission, said in an interview. “But as the Westerners say: ‘Rome was not built in a day.’

But Beijing believes hosting big futures markets will enhance the country’s economic security by essentially advertising what the world’s biggest customer for some commodities considers a fair price. For the rest of the world, the exchanges could mean less guesswork about China’s buying habits, possibly reducing volatility in the global market.

Silver Lining: Jim Rogers Talks Up Commodities – Time Magazine

Jim Rogers’ daughters may not have been born with silver spoons in their mouths, but they’ve got them now. Not silver spoons, exactly, but silver bullion. “My little girls don’t own stocks — they own commodities,” he says, “and that’s why they’ll be able to take care of me in retirement.”

Rogers sees three big secular trends now, and he’s acting on all of them. First, America’s role as the dominant economic power is declining, so why own American stocks? (He doesn’t.) Second, China is emerging, and even though it may have crises from time to time, it is a good place to invest. (He does.) Third — and this is the biggie — emerging nations including China are greatly increasing the future demand for commodities such as oil. (He’s in with both feet.)

“Thirty years ago, 3 billion people were not even participating in the world economy, and now they are trying to live like we do,” he notes. That emerging megaforce, says Rogers, will put a supertight squeeze on commodity prices across the board, from beef to bullion.

Oil Climbs Above $73, Nat. Gas Rallies as Equities Fly High – Rigzone

Jumping toward $74 a barrel on an American holiday, crude oil rallied more than $1 from last week’s closing price, bolstered by a weaker dollar and a rise in the equities market. Also gaining today, natural gas closed 12 cents below $5 as the energy commodity continues to strengthen despite bearish fundamentals.

After rallying to an intra-day high of $73.84, the price of crude oil settled slightly lower to $73.27 on the NYMEX Monday, a gain of $1.50 from Friday’s close. Additionally, the US dollar eased against a basket of foreign currencies, helping to spur a rally in today’s commodity prices.

China Iron Ore Imports Exceed Real Demand, CISA Says – Bloomberg via Chinamining.org

Iron ore imports by China, the world’s largest buyer, have exceeded real demand by 50 million metric tons this year, the country’s steel association said.

China’s iron ore imports surged to a record this year, hurting the group’s bid to negotiate a contract price cut bigger than the 33 percent offered by Rio Tinto Group and BHP Billiton Ltd. The nation is looking at cutting the number of licensed importers, industry minister Li Yizhong reiterated today.

China and rare earth metals

The Economist has just published a new article about China’s abundant and ever more precious rare earth metals. This adds to a flurry or articles, which have recently made it into major English language publications here in the US and Canada—including the Wall Street Journal, Market Watch and the Canadian Business Week.

The value of global rare-earth trade last year was just $1.25 billion, and it is projected to grow to about $3 billion by 2015—not much by most accords. However, the metals in question are absolutely essential for many high tech industries because of their phosphorescent and magnetic properties.

Rare earth metals include terbium, dysprosium, yttrium, thulium, lutetium, neodymium, europium, cerium, and lanthanum. These metals, as described by The Columbia Encyclopedia usually occur together in minerals as their oxides ( rare earths ) and are somewhat difficult to separate because of their chemical similarity.

The state-controlled Inner Mongolia Baotou Steel Rare-Earth Hi-Tech Company dominates production of “rare earth metals” in China. Alistair Stephens of Arafura Resources in Australia, explains, “the Chinese realized the strategic importance of rare earths decades before the West.”

Producing the latest flat screen TV’s, smart phones, wine turbines, solar panels and even electric batteries which power America’s new Chevy Volt (battery powered car), are all simply not possible without these rare earth metals.

I am not one to doubt the incredible potential of the free market system, but in this particular situation, Deng Xiaoping was wise not to trust in the free market to dictate his “rare earth metals” policy in the 80’s.

As commodity prices fell in the mid 80’s, rare earth producers in the United States and Canada were priced out of the market. Deng Xiaoping, the man associated with introducing markets in China, instead encouraged the development of mines in the mid-1980s as prices fell dramatically.

Rare earth metals may not generate as much revenue as oil does for Saudi Arabia or Russia, but it is clear if China chokes off supply and begins consuming more of their rare earth metals domestically, the developed world will need to find new sources.

Additional articles on rare earth metals:

Will China Tighten ‘Rare Earth’ Grip? – The Wall Street Journal

Rare earths are vital; and China owns them all – Market Watch

Rare-earth metals: The new China syndrome – The Canadian Business Week