Demand for food and clothing in developing nations throughout the world will prompt commodities to perform better than companies purchasing raw materials during the next 10 years.
Such is the opinion of Galtere Ltd., an investment company with $1.1 billion in holdings, according to Bloomberg. Manufacturers and retailers will be unable to fully capitalize on higher costs to customers so shares of companies using raw materials will not gain in the commodities markets, analyst Laurel Polen told Bloomberg last week.
"We definitely see a structural shift where you are going to have over the next 10 years real assets, commodities across the board, outperforming paper assets like equities," Polen said.
Demand for grains, dairy products, meat and cooking oils is gradually widening from Brazil, India and China, which also are enjoying increasing amounts of wealth. The Chinese and Indian economies are growing three-times as rapidly as the U.S.' economy.
"Demand pull from emerging market countries is going to help sustain higher prices, so there is going to be a longer-term structural bull market," she said.
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