The Southwood Group is advising clients on investment strategies to maximize returns from Rice, during difficult times for this vital commodity.
Rice, the principle food crop of Asia and an important contributor in many other parts of the world’s food holding banks is usually a safe investment, however stockpiles are growing, supply is up and trading prices are down. It is uncertain as far as profit is concerned for Rice, however with prices low and with Rice always guaranteed to be a major seller now is certainly a good time for investors to take advantage of the low prices.
China the world’s largest importer and consumer of rice are set to purchase 3 million metric tons this month, a record amount this year. The Chinese government has increased its purchasing levels due to the low prices and as a result of their domestic supply being dealt a blow due to the discovery of a toxic metal in the rice supply in southern China. The discovery of Cadmium in domestic supply has increased the country’s need for importing resulting in China’s imports of rice being set to hit a record high later this year.
“The assumption is often made that when prices start to fall due to stockpiling there isn’t future gains to be made, however we must remember that this is a stable addition to millions of people’s diets making it a life sustaining commodity. The agricultural commodity will always sell, the key is now selecting the right time to take advantage to this low price opportunity within this buyers market,” said Senior Vice President of Mergers and Acquisitions James Morgan at The Southwood Group.
Rice reserves are gaining beyond the global demand by 2.5 percent with stored quantities almost reaching 109 million metric tons, the overall Asian output will be offset by the U.S. as its predicted output will drop to a two year low by 5 percent reducing the country’s reserves to its lowest point since 2009. Fluctuating markets give way to short-term trading to continue at a fast pace whilst the rough rice futures trade up on the CBOT market Thailand’s SET market trades down due to a government scheme for purchasing the home grown commodity at inflated value resulting in stockpiling.
“Last year we successfully advised our clients through the commodities turbulent path to return exceptional gains, we are putting together recommendations for this year’s forecast placing our clients in the best possible positions to minimise risk potential ensuring future gains,” concluded Senior Vice President of Mergers and Acquisitions James Morgan at The Southwood Group.
As an equity-research house, The Southwood Group specialises in providing fundamental research and data analysis, ultimately facilitating trend identification, and finally stock selection. The company has professional managers with extensive experience in all aspects of investing and legal compliance, all of whom had spent their careers in the global finance industry from Hong Kong to New York. It is established on ideals of perseverance, enduring commitment to its clients and, most of all, due diligence.
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