LONDON (Reuters) – Soft commodities will likely outperform other commodity asset classes over the next five years, in large part due to their ties to energy, a senior sugar trader said on Tuesday.
Jonathan Boyden, head of sugar trading at Ambrian Capital, said soft commodity prices had risen by 29 percent in the past five years — less impressive than base metals (up 454 percent), precious metals (up 168 percent), and grains (up 116 percent).
But softs futures — sugar, coffee and cocoa — have soared by more than 20 percent since the start of 2008, powered by investment funds and speculators which are seeking big returns in agricultural commodities.
"A lot of the driving force in softs is a pick-up of what has happened in energy," Boyden said. "It’s not just about food any more."
