Recommended reading: Mark Faber’s analysis of agricultural commodities (MP3 Audio / Transcript).
Some commodities may have overshot already, but agriculture is one of my favourites because food production in China has been declining. They have a water problem, and through the industrialization and the construction of golf courses there’s less land available for agriculture.
So I would go and look at some agricultural commodity prices that haven’t moved much yet like corn, soya beans, wheat, sugar. The Swiss drink 50 times more coffee per capita than the Chinese, but the Chinese have a population 200 times larger than the Swiss so their market is already larger. If they go to the per capita consumption level of the South Koreans, Taiwanese, Japanese – non-traditional coffee drinkers –
they will take up three times the coffee crop in the world.