Investment guru : Thailand 'should look to its farms'

Rogers, who correctly predicted in April 2006 that gold would reach US$1,000 and oil $100, said on Thursday night that the Kingdom had an advantage in the sector.

"This is a onceinalifetime opportunity. I hope the government and its people will encourage the agricultural sector," Rogers said.

The commodity guru said he would like to trade rice in Bangkok if liquidity was high enough.

The Agriculture Futures Exchange of Thailand started in May 2004. Its commodities include white rice 5 per cent, ribbed smoked rubber sheet No 3, tapioca chips and tapioca starch premium grade.

Thailand is also the world's largest exporter of rice, at 8 million to 9 million tonnes per year out of a total production of more than 20 million tonnes. It is also one of the largest exporters of rubber.

Rogers said the potential for Thailand was high as other agriculturalcommodities futures markets were limited.

In Chicago there are hardly any riceconsumers or producers; Singapore is rich enough but produces no crops; Tokyo, the only other such trader in Asia, deals in rubber but not rice.

China has several commodity markets, but foreignexchange controls make its futures market unattractive, Rogers said.

"I've advised Japan, China and Singapore, and now I suggest Thailand. Some of these countries could be commodity centres in Asia. When China opens its foreignexchange market, that will be too late for you," he warned.

He emphasised that this was Thailand's window of opportunity.

However, he cautioned against government intervention.

"Your government is part of the problem. They keep intervening in the market … The market has been fluctuating," he said.

He said the government would be better off letting the market mechanism operate without interference and previous attempts at fixing commodity prices in various countries had resulted in many failures.

"Politics wants to control everything, but price control has never worked," he said.

Rogers said he might be interested in adding tapioca to the Rogers International Commodity Index (RICI) if there was ever enough volume in the futures market. Rogers created the RICI in 1998 by weighting a group of 35 commodities for which he found there was no fund investment or index measurement. It has produced a total return of 194 per cent, making it the topperforming investment index in the world over the past six years, according to the Barclay Trading Group.

Rogers is still bullish on commodities, particularly agriculture, which indeed has been one of the strongest performers in the recent commodities boom.

He cites the need for alternative energy from maize and sugar and the great demand which will be generated by the climate crisis.

Asked how long he thought the commodity boom would last, Rogers said he could not be sure but probably a while.

"Now I'm recommending you to buy commodities, but in 2020 I might return and tell you to sell commodities, when you might think that I'm kidding because commodities prices are continually rising, but I'll tell you it's time. It comes to an end finally," Rogers said.

Bullish as he is, he said he had never used the word "safe" about investment, but he suggested investors note that cotton, coffee and sugar were currently 6080 per cent below their peak some decades ago.

Rogers also urged the government to support ethanol production from sugar, as Brazil had successfully done over the past three decades.

"You have lots of sugar. You can do it. With more than 60 million people, you have a large energy market," he said.

He thought maize less suitable for producing ethanol, saying tapioca was a better choice.

Meanwhile Rogers slammed Federal Reserve chairman Ben Bernanke's handling of the credit crunch, saying the US central bank was printing money to bail out a small group of Wall Street friends at the risk of world inflation.

He said the Bank of Thailand had done a better job of tackling inflation than some central banks but not good enough as Thailand still faced high inflation. He mentioned Australia and New Zealand as examples to follow.