Finite reserves are the main driver of key commodities prices

Interesting investment opportunities exist across the three main natural resources areas: energy, metals and agriculture. In recent months the energy, metals and mining sectors have been particularly strong performers, with companies such as South African miner Gold Fields and Vale, a Brazilian diversified mining company, delivering attractive returns.

This performance is indicative of a long-term growing demand for natural resources. We expect this trend to continue as a result of changing global demographics, urbanisation and increasing prosperity in emerging markets. The fact reserves of most key commodities are finite is likely to be an additional driver of commodity prices going forward. There are also problems relating to access, rising exploration and production costs and a lack of infrastructure at play, all creating constraints on the supply side. This supply/demand imbalance gives a positive outlook for commodity prices. I...