Corn and sugar look poised - with gold - to lead commodities markets, boosted by supply squeezes at a time of solid demand, a leading fund manager has said. Bradley George, the head of global commodities and resources at Investec Asset Management, said the funds group was "certainly holding long positions in corn and gold". He added: "As for sugar, we do think there is more upside in the price itself given the supply-demand fundamentals and the fact that the yields may not be as promising." 'Too optimistic' Hopes for output in Brazil, the world's biggest producer, may be too high given the obstacle that heavy rain presented to harvesting and yields. "Brazil has recently downgraded its 2009-10 forecasted production on lower sugar content per tonne of cane," Mr George, head of commodities and resources at Investec, said. "These numbers could still be too optimistic compared with private forecasts." Prices of raw sugar should gain support at 22-24 cents per pound in New York, where the benchmark March contract stood down 0.22 cents at 23.82 cents in early trade on Thursday. Sugar in August hit a 28-year high of 24.85 cents a pound. Frost threat For corn, Investec pointed to Chicago prices which, at roughly $4 a bushel, were a little over half of those achieved in last year's bull run "despite [US] harvests progressing very slowly", leaving them vulnerable to frost damage. Global production of gold, meanwhile, had fallen from 2,600 tonnes in 2001 to 2,450 tonnes last year. The precious metal, often viewed as a hedge against the dollar, represents "the only currency whose production is going down, and not up", Mr George said.

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