The Commodities Markets Today

Dr.Francisco Blanch is seeing that,in the short run,it's still a very tight crude oil market.
Dr.Blanch,global head of commodities research and a managing director at Bank of America-Merrill Lynch,notes that we're going into the summer driving season now.
China has stopped exporting diesel.Japan has strong needs for fuel.It's still very tight going into June and July.
You can only buy West Texas Intermediate crude around Texas and Oklahoma.Brent crude should be your global benchmark.It may be at 140.00 a barrel in three months.It is currently around 115.00.
In terms of the economic context for commodities,Dr.Blanch observes that real interest rates are about to turn upward.If the U.S. economy gets back on track,the Federal Reserve will not renew the Quantitative Easing policy.
These factors tend to support commodity prices.
Dr.Blanch says they also like corn and palladium.
Francisco Blanch has a doctorate from the Complutense University of Madrid.He is the publisher of widely read newsletters such as Global Energy Weekly,Commodity Strategist and Energy Strategist.
Bank of America(BAC)

Enbridge Sees Growth Stretching Out

This is the strongest growth that we've had,and we see it going five years out,says Enbridge,Incorporated's CEO Patrick Daniel.The Canada-based energy delivery company serves North America with its transport and distribution of oil and natural gas,as well as its interests in renewable and green energy technologies ranging from wind to solar.The Canadian oil sands,as well as the Bakken and Eagleford shales,will make us much less dependent on foreign oil than we are,there's no doubt,Mr.Daniel believes.
Canadian energy producers like the optionality of our largest pipeline system in the world.In addition to Enbridge's vast and complex oil pipeline system,we think we're in a very strong position to export Canadian natural gas.
Citing the Gateway Pipeline to the west coast,Mr.Daniel promotes Enbridge as a jobs-creator.They're very good jobs that stem from both the construction and operation of our pipelines,he indicates.
Enbridge employs 6,000 Canadian and American workers.The company has never cut its dividend in 55 years.It is listed on both the Toronto and New York stock exchanges under the same ticker symbol,ENB.

PepsiCo Confident Going Forward

PepsiCo is confident in meeting the challenges it faces in today's business climate.We really do think we've got a portfolio of brands and market positions that enable us to manage rising costs effectively,says chief financial officer Hugh Johnson.My expectation is,we'll be taking pricing across the whole of our business.Strong brands growth is offsetting higher commodity costs.
While you see some challenges in developed markets,developing markets are growing quite strongly.We feel committed to 7-8% growth this year,Mr.Johnson noted.
PepsiCo beat Q1 earnings estimates slightly on both the top and bottom lines,but has an outlook a little below Wall Street expectations.In December 2010,it announced it was acquiring a controlling stake in Wimm-Bill-Dann,a Russian beverage titan.Wimm-Bill-Dann is the market leader in dairy products and children's food in Russia,Ukraine and the Commonwealth of Independent States,and a major producer of juice drinks.For PepsiCo,it's another move away from carbonated beverages to a much broader porfolio of brands.
PepsiCo is led by CEO Indra Nooyi.
PepsiCo(PEP),Wimm-Bill-Dann(WBD)

Fiscal Reform:Geithner's Global Optimism

In the view of U.S. Treasury Secretary Timothy Geithner,the journey to fiscal responsibility is well underway worldwide.In the U.S.,Mr.Geithner said,the important thing for the economy now is to lock in reforms to bring down the long term deficit.It's not surprising that average people are sceptical of Washington.I'm confident we will start the process.I think it's achievable.There's an emerging consensus on how much we have to do-four trillion in cuts-and the time frame.
The more details you have,the more credible it's gonna be.Faced with enormous challenge,Washington has always come together.You have to do it in a balanced,comprehensive way.There's no way to do this without changing our tax code.Life's about alternatives.We need a balanced,comprehensive package that will add modestly to the burden of the most fortunate Americans.
We have to earn the confidence of investors,but I didn't have to reassure foreign investors when Standard&Poor's downgraded their U.S. credit outlook to negative.We don't know how much is gonna be possible,but we have good prospects of laying down a foundation.
For its part,Europe is doing incredibly difficult reforms.The leaders of Europe have said they will do whatever is necessary to address the sovereign debt issue,and they're making some progress,in Timothy Geithner's estimation.
Before assuming his cabinet post,Mr.Geithner was president of the Federal Reserve Bank of New York,where he played an integral role in dealing with the financial crisis,assisting his predecessor at Treasury,Hank Paulson.Although initially disliked by some in Congress for mistakes he made on his income taxes some years ago,he has developed a decent working relationship with lawmakers over time.

Brazil Still A Force

U.S. equities will be higher.We think the markets are still gonna rally,says Michael Yoshikami of YCMNET Advisors,and the emerging markets are gonna continue to do well with their commodities.Singapore is the Switzerland of Asia.
We think Brazil is still an impact story.There is enough appetite for Latin America from U.S. companies.You can't put everything in Asia.Brazil is gonna continue to be a major trading partner with China,and that's gonna drive that economy.U.S. companies see a slow GDP story in the U.S.
Gold will reach 2,000 dollars an ounce.You buy gold for scepticism about the markets and as an inflation hedge.Food is going to be huge in demand.Commodities need to be part of an investor's portfolio,in Mr.Yoshikami's opinion.
YCMNET Advisors is a wealth management firm located in Walnut Creek,California.It was named one of Barron's Top 100 Independent Advisors for 2010.
iShares MSCI Brazil Index Fund(EWZ)

Finance and Foreign Affairs:The View From Qatar

A leading figure in Gulf states finance and foreign affairs has been reflecting on the recent turmoil in the region.We are thinking the Libyan people didn't deserve this,says Sheikh Hamad bin Jassim bin Jabr Al-Thani,Prime Minister and Foreign Minister of Qatar,who also helps oversee Qatar's sovereign wealth.Most of the problem in the Middle East is the economy.Gadaffi should go,leave the people of Libya decide what they want to do.
We see a lot of movement in Qatar.Some of the big companies are moving into Qatar from Egypt.
Between 5 and 7 years we will finish the Qatar infrastructure.Seventy billion is already allocated for that.The challenge is what to do after that to keep the growth 5-8%.We don't want the growth to collapse in 3-4 years when the work is finished.
Last year we invested more than 20 billion.This year we must invest 35 billion if we have the opportunity.We invested in Washington property,as it is a city that is not affected a lot by real estate problems because it is the capital.We think it's the right time to invest in U.S. commercial real estate.We are also looking at retail and energy in the U.S.
We have to be realistic about the supply and demand for energy.The supply is there,but there is anxiety about the Middle East events.In Asia,we sell our gas 3-4 times what we sell it for in the U.S.;Asia is our natural market,frankly speaking.
With regard to censorship of the Internet,to shut down any technology,I think this is stupid,the British-educated Sheikh Hamad believes.
Through its Delta Two fund,which is headed by Sheikh Hamad bin Jassim and managed by Paul Taylor,the Qatari government has increased its stake in British retailer Sainsbury to just over 25%.This is being seen as another step in a possible takeover of the department store chain.