Salient to Investors:

Goldman Sachs maintained its neutral recommendation on commodity prices, predicting a significant decline in agriculture in half2 even if summer weather is slightly worse than 2011.

 Jeffrey Currie and Damien Courvalin et al at Goldman predict the S&P GSCI Enhanced Index will return 2.3 percent over 12 months, saying prices are unlikely to collapse as demand is not weak enough to create large unexpected inventory builds, while supply rarely creates a surge in inventory when demand falls unexpectedly.

Goldman and Citigroup predicted the end of the decade-long bull market in commodities after prices more than doubled in 10 years, spurring expansions at mines, farms and oil fields. Gluts are emerging as the IMF predicts global growth of 3.3 percent in 2013 versus 3.2 percent in 2012.

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