Rogers to park assets in commodities

Investor Jim Rogers said he may sell all US dollar-denominated assets as early as in the coming weeks in favour of agricultural commodities.

"I'm hoping to move all of my assets out of US dollars in the next few weeks or months,'' the 65-year-old chairman of Beeland Interests told reporters in Hong Kong through a video link today from Singapore to mark the launch of a Barclays fund targeting Hong Kong individuals and based on the Rogers International Commodity Index "" Total Index.

Demand not matched by increases in supply makes commodities "one of the best places to be if you want to get out of the US dollars,'' Rogers said, who predicted the start of the global commodities rally in 1999.

He particularly favours agricultural commodities such as sugar and cotton, which are trading below their historical highs, he said.

Agricultural products are rising because of increasing demand for food and biofuel as crude oil soars to a record. Crude traded at a record $98.62 last week in New York. Wheat traded on the Chicago Board of Trade reached a record $9.6175 a bushel on September 28.

Still, sugar has fallen 15 per cent this year in New York as rising production in India pushes down prices.

Long Way Down
Rogers said the US economy may already be in recession and no stock market around the world is attractive at the moment. "Shares still have a long way down to go over the next two or three years, at least according to my estimation,'' he said.

Declines in equities could drag down commodities prices, thought depleting reserves will over the long term support resources prices, he said. Historical commodity booms lasted 15 years to 23 years, meaning the current rally may continue through 2014 to 2022, barring major setbacks such as Avian influenza, or bird-flu, pandemic, Rogers said.

Oil will hit $150 or $200 in the course of the commodity bull market because no one has discovered a major oilfield for over 40 years, Rogers said.

The Rogers commodities index, tracking more than 30 commodities including energy, metals and agricultural products, has surged more than 300 per cent since its inception in 1998, said Wendy Kwan, Barclays Capital's director of investor solutions.

Hong Kong Dollar
Rogers said Hong Kong would be able to improve the efficiency and profitability of trade with mainland China, should it abolish its local currency and adopt the yuan once the mainland Chinese currency becomes fully convertible.

"You have a gigantic neighbour who's becoming the most incredible economy in the world," Rogers said. "It'd be like having a special currency for Mississippi when the rest of the US uses the dollar.''

He said he wouldn't be surprised if the yuan becomes fully convertible by the time Beijing hosts the Olympics next year or the 2010 Shanghai World Expo.