Prices for farm commodities will be trumped by precious metals' increasing values next year, according to the head of commodities research at Societe Generale.
"In agriculture there isn't much upside potential," Frederic Lasserre told reporters on Monday, according to Bloomberg. "We might see some gold-price rally again because of the recent fears regarding sovereign debt, and also the impact it may have on the dollar–euro."
International economies' continued struggle with debt and financial uncertainty will assist gold, silver and palladium to outperform farm products such as sugar, he said. Precious metals serve as a hedge during uneasy economic times, such as the struggles that Ireland is working its way out of as it prepares to accept a European Union and International Monetary Fund bailout of its debt-ridden banks.
Corn and wheat only will gain one percent during the next 12 months and raw sugar could lose 33 percent of its value, scraping against it long-term floor, Lasserre said.
By contrast, precious metals prices have had very strong performances in 2010 that are expected to resume next year. Spot gold has advanced 24 percent, palladium has increased 75 percent, and silver has gone up 64 percent.
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