Commodity markets are in the news every day now, from record-high gasoline prices in the United States to 
Yes, that Jim Rogers. The one that rode a motorcyle around the world. The one that co-founded the Quantum Fund with George Soros. The one that was so bullish on commodities in 1998 (yes, 10 years ago, in the middle of the dot.com mania), that he developed his own commodities index fund.
“Hot Commodities,” written and published in 2004, explores the physical, fundamental reasons why Rogers believes commodity prices were underpriced then and could be in a bull market for several years. Overarching individual market particulars is Rogers’ belief that “China will be the world’s next great nation.” And, as its economy grows, it will place demand on raw commodities that will support his bullish beliefs.
Rogers focuses on markets with worldwide production and consumption in “Hot Commodiites.” First on the list is crude oil, where he argues that oil capacity is not keeping pace with consumption. Next up, gold, which he describes as on top of the heap for “mystique and popular appeal.” (Although, even in 2004, Rogers wrote that the 1980 historic high of $850 “is not a price we’re likely to see soon–outside an economic collapse so awful that we will all be fighitng one another to buy gold.”)
Other hot commodities that Rogers focuses on include lead, sugar and coffee. Lead, with rising prices in the face of declining demand due to lack of infrastructure investment. Sugar, which is tied into the energy markets due to its use as an ethanol ingredient. Coffee, which is playing catch-up to increasing demand worldwide.
“Hot Commodities” is a book you’ll wish you had read three years ago, when crude oil was at $50 per barrel and gold was at $450 per oz. But, if Rogers is right, it’s still not too late.
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