The bear market for commodities is over and it is time for investors to focus on this asset class again, according to a commodities analyst.
Goeff Blanning, head of commodities at Schroders Asset Management thinks that a new bull market for commodities has begun.
"Following five years of devastatingly poor returns in the market, sentiment towards commodities is at rock bottom, but it's starting to turn following the surge in the prices of a wide variety of products since the beginning of the year," he said, adding that the biggest price gains, in percentage terms, occur at the beginning of a bull market.
Explaining that the primary reason for investing in commodities should always be inflation hedge, Blanning argues that with the continued printing of money by the world's central banks, there is every reason to argue that higher inflation is coming in the future. "And one way to protect oneself could be through buying commodities."
The commodity sector has seen tough times in the past few years for reasons such as global uncertainty and overproduction. Crude oil prices have largely rallied since mid-January, after a steep and lengthy rout from June 2014 onward hit commodities across the board. The oil and gas sector is down nearly 25 percent over the past two years, while basic resources are down about 34 percent.