There has been a lot of talk about Palm oil, fueled mostly by the meteoric rise of palm oil futures on the back of demand from — where else — China and India. Red Palm oil is cold-pressed and bottled as cooking oil; blended into mayonnaise & salad oil; even fortified into health foods & anti-aging cosmetics. The main global trade of the product is through RBDPO Continue reading “Investment Strategy: Palm Oil & the Africa Connection”
This is a much older story, first breaking in late September that has since gone into silent mode — probably as the deal-making is done or is killed by the majority owner. Essentially, the 150-year old trader Louis Dreyfus Commodities is hoping to reinvent itself from a flow-trader agency trading commodities to someone who can bet its own balance sheet. Continue reading “Trade Notes: buy Louis Dreyfus?”
The short answer would be an easy “Yes”. This was emphasised most recently by the September returns of Clive Capital, Chris Levett’s commodity hedge fund based on macro calls. He used to run a similar portfolio at Moore Capital before he left to start up his own firm in December 2007 (in case you’re wondering, his middle name is Clive). That fund returned 6.6% last month, that’s a pretty tidy profit on roughly USD 4 billion AUM. More so considering it was up around 1.7% for the previous nine months. I’m not a big fan of Clive because they tend to use rather a lot of leverage, don’t communicate much, and haven’t been able to protect the downside as they claimed in their marketing material. In any case, the reasons for the performance are interesting, Continue reading “Trade Notes: Is There a way to Play Global Warming and Weather Volatility?”
Kind of weird corollary to India growing is that there is increasing milk demand in India.
The WPI in India has a 5% weight on milk, and that is having an effect because there was a 13.4% YoY inflation in milk prices in December ’09. This is coming from a demand supply mismatch as there is an increasing uptake on processed milk products (most notably Reliance’s “Life”, Nestle’s “Pro-heart”, and Amul’s “Taaza”). Continue reading “Trade Notes: Got Milk?”