Most spices that trade on exchanges are likely to do well in 2015.
According to the World Bank, global metal prices are expected to fall more than 5 per cent in 2014 due to new supplies and low demand from China.
As a commodity investor, you can take advantage of the resulting shortages pushing up prices. For instance, in 2002-03, when El Nino disrupted the monsoon, castor seed production fell 34 per cent. As a result, its price zoomed 30 per cent during the summer season.
In a move towards making gold and silver futures contracts more transparent and convenient, the National Commodity Derivatives Exchange has introduced special gold and silver hedge contracts.
Money Today in its last issue looked at commodities that gave positive returns in 2013. Now, it brings you the outlook for those that did not perform well.
Out of the 21 major commodities that trade on the National Commodity and Derivatives Exchange, 11 gave positive returns last year. Money Today discuss their prospects for 2014.
On the MCX, crude oil fell over 10% to Rs 6,358 per barrel on September 30 as against Rs 7,366 on August 30. In dollar terms, the WTI crude fell 4.5%, while the rupee rose 5% against the dollar, impacting the price by 10%.
Base metals have been dancing to the tune of global forces. Under pressure in the first six months of the year, they staged a sharp rebound in July. Money Today talks to experts to gauge how the market is likely to play out in the next few months.
Though a normal monsoon will be good for the output of soybean, cotton, sugarcane and castor seed, and their by-products, but returns from these farm commodities that trade on exchanges will be lower this year.
Guar gum and guar seed futures, banned after a sharp 500% rally between October 2011 and March 2012, are due for calmer times. Experts see little chance of a price rally after the ban was lifted in May this year.
Experts suggest you take a cautious approach and invest in commodities that are fundamentally strong and trading close to the cost of production.
Before investing in iron ore you should look at factors such as the government's mining policies, likely export/import figures and demand in key consuming countries such as China.
The estimates, for crop year 2012-13 (June-July), released by the agriculture ministry, show that supply of wheat, maize and sugarcane is likely to fall, putting upward pressure on prices. We talked to experts to know what numbers mean for prices of farm commodities traded on exchanges.
The industrial metal pack - lead, tin, zinc, nickel, copper, aluminium and iron ore - which trade on the Multi Commodity Exchange, returned 11 per cent between August 16 and September 22, as against a negative 4 per cent return this year till August 14.
Export pull can be a big plus for any asset. While it's a general rule that commodities with good export demand can deliver good returns to investors, it's not the only rule.
When we think about investing in precious metals, how often do we look beyond gold and silver? Not very, one would say. Platinum, say experts, can be a good portfolio diversifier.
In our previous issue, we analysed the World Bank's outlook on farm commodities. Now, we weigh its take on base metals.
While global trends may be reflected in some commodities, experts feel domestic prices of some commodities may move in a different direction.
We analyse how five commodities that have given the highest returns in the last five years are likely to perform in the future.
If you are looking to diversify your portfolio, you can invest some funds in oil and oilseeds for steady returns.
CP Krishnan, Whole Time Director, Geojit Comtrade, tells Rahul Oberoi how spices trading is growing in India.





