04.11.2015 - Commodity rout has room to run as fund sees oil, iron at $40
The rout in commodities is set to get worse as resilient supply and faltering Chinese demand will see global gluts persist, sending oil and iron ore below $40, according to Merchant Commodity Fund. Prices are still trying to find a floor with excess supply in almost every commodity, said Michael Coleman, managing director of RCMA Asset Management Pte, which runs the $210 million fund. Any rally in raw materials will be probably short- lived as demand isn’t improving and production cuts are insufficient to stem surpluses, he said in an interview. Commodity prices are languishing near a 16-year low as supplies outstrip demand amid forecasts for the slowest full- year expansion in China since 1990. Money has been flowing out of commodityfunds as investors punish shares of oil drillers, miners and traders including BHP Billiton Ltd. and Glencore Plc...............................................Full Article: Source
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