Grains and Metals Recovering After Tumble

Metal and crop prices are poised to rebound in 2014 as accelerating economic growth boosts demand, helping to staunch this year’s record retreat for investments in commodity-focused funds.

Average annual prices for 15 of 23 non-energy commodities from aluminum to sugar will be higher than now, according to estimates from as many as 26 analysts compiled by Bloomberg. Corn may rise as much as 20 percent, platinum 24 percent and nickel 18 percent, based on the median of trader and investor forecasts in a survey that asked as many as 59 respondents to predict next year’s peak price for each of 15 raw materials.

Corn, silver and gold dropped the most in 2013, and five more raw materials tumbled into bear markets as output rose and investors shifted to equities. Commodity-fund investments fell by a record $88 billion to $332 billion in the first 11 months, almost all of it in metals and agriculture, Barclays Plc says. While Goldman Sachs Group Inc. says supplies are mostly ample and Bank of America Corp. expects more losses, global manufacturing is the strongest since April 2011 and the International Monetary Fund says world growth will quicken.

Bloomberg

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