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Note: This is a follow up report on our story from June 4th “Commodities trader warns of coming `Perfect Storm` - why the real commodity to watch is food” coverage.

From Benedicte Gravrand, Geneva: Commodities have gone from being a niche market to being a primary market. Futures contracts at the CBT have gone up 43% for agricultural products and 60% for metals and energy in the last 3 years. Commodities are becoming red hot allocations for institutional investors, and financial institutions are getting involved.

Bloomberg recently reported that Bear Stearns Cos., the biggest broker for U.S. hedge funds, is expanding its commodities business to meet growing demand from speculators who want to invest in metals, energy and agriculture. And that JPMorgan Chase & Co.'s Blythe Masters lost two-thirds of her 600-person staff in an internal reorganization at the third-largest U.S. bank that leaves her focusing only on commodities. Reuters also recently reported on fears in Europe, as agricultural markets are pushing food prices up in Europe, putting central bankers on alert for a new phenomenon economists have termed "agflation" (an increase in the price of food that occurs as a result of increased demand from human consumption and use as an alternative energy resource).

Opalesque talked to Greg Smith, managing d......................

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