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Tag Archives: Natural Resources

Natural Resource Chart of the Week

http://www.globalfundexchange.com/blog/2013/01/17/natural-resource-chart-of-the-week/

The Global Resource world is changing dramatically with the entry of new players in the markets and significantly changing weather patters. In just six months we  have seen the worst drought in over half a century that devastated the crop in the US corn producing farm belt sending ripples through agricultural markets. This was promptly followed by ‘Superstorm’ Sandy – the worst hurricane on record. Also, unusually intense typhoons in China (three consecutive in the span of one week) damaged approximately 3.5 million hectares of farmland in major corn, rice and wheat producing areas while floods created worries about lower grains supply from Australia and Argentina.

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Australia is currently experiencing its highest temperatures since record keeping began and the country is being devastated by epic fires destroying homes, farms and infrastructure at an unparalleled rate.

Read our most recent piece by Anric Blatt on the most compelling investment ideas for 2013 and beyond by clicking here.

by Anric

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Rapidly growing middle class could fuel another rally for commodities, is water and energy next?

The pattern of rising commodity prices over the past decade supports our view that the rapidly expanding global middle class has a strong appetite for commodities.

This growing body of more prosperous consumers could have significant impact on global demand and supply. Rising incomes generally lead to increased use of transportation, greater energy demand, and increased consumption of milk and meat which brings additional demand for grains, and thereby dramatic water use increases.

Yet demand for key commodities such as oil and copper are already close to full capacity utilisation rates. At the same time, oil discoveries have lagged oil production and oil continues to decline as a percentage of total energy consumption. There are implications for the ability of central banks to hold back inflation.

Further, the world population is aging, while the labour force looks set to shrink. This would result in a strong rise in the dependency ratio, both in the developed world and emerging economies.

Predictably, the rise of a global middle class will cause a fresh round of accelerating price increases in commodities, resulting in a new spike in the next few years.

Energy, Water & Commodities are undeniably linked and are some of the core themes of our Earth Wind & Fire and AquaTerra portfolios. It is thus that we keep e keen eye on these mega macro trends as they emerge.

Please contact us if you would like to receive a PDF version of our latest global macro viewpoints presentation.

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Following China's Lead, India Steps up Overseas Resources Investments

To satisfy its booming energy and resources needs, India is stepping up investments in foreign oil and resources assets. The International Petroleum Company of India (ONGC) has already acquired offshore oil and natural gas resources in Myanmar, Russia, and Vietnam.  Just like fellow developing nation China, which has put billions of dollars into overseas resources, India is looking to acquire additional assets.

ONGC’s Chairman R.S. Sharma is reportedly petitioning the federal government to establish a sovereign wealth investment fund to continue making these investments, as India is heavily reliant on imported oil.  In fact, the relationship between India and Saudi Arabia has developed so much recently that the Saudis have committed to doubling crude oil shipments to India.

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Posted by on March 25, 2010 in Natural Resources, Oil, Traditional Energy

 

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China Tightens Control of "Rare Earth" Elements

China Continues Domination of “Rare Earth” Elements

China produces approximately 93% of “rare earth elements,” little-known yet important elements such as dysprosium and terbium which are used in a variety of cleantech applications and missile technologies.  For the past few years, China has limited the production and exportation of these rare earths, and rumors are flying that China’s Ministry of Industry and Information Technology is planning to further tighten these regulations.  These policy changes could result in global manufacturers in rare earth-dependent industries moving business operations to China in order to guarantee access to these items.  Demand for rare earths, which can fetch up to $150/lb, has spiked due to wind turbines and new hybrid vehicles.  The electric motor in a Prius, for example, requires 2-4 lbs of the rare earth neodymium.  “The people who are making these products outside China are at a huge disadvantage and that is why more and more manufacturing is moving to China,” said Dudley Kingsnorth, an industry consultant based in Perth, Australia.

 
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Posted by on September 8, 2009 in Natural Resources

 

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