Commodity Stocks

Updated:
03.27.09
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Description:

Despite the current global recession, few economists can argue against the economic expansion that will occur in countries like Russia, Brazil, China, and India over the next 20 to 50 years.

One of the worldâ€™s largest conglomerate commodity companies RioTinto Alcan (RTP) recently accepted an 18 percent investment from Chinalco, a Chinese metals company doubling Chinalcoâ€™s investment. Chinalco is offering to invest $12.3 billion in joint investments in aluminum, copper and ore mining with Rio Tinto, and to spend $7.2 billion on convertible bonds in the company. If redeemed for shares the bonds would almost double Chinalco's existing 9.3 percent stake in Rio Tinto Group to 18 percent.
Last year Rio Tinto rejected a possible merger with BHP Billiton (BHP).
Notwithstanding the cyclical decline in demand that is associated with a global slowdown, the time to buy commodity related stocks is when inventory for the underlying commodity are at record levels.
Here are several commodity names to watch going forward: