Found an interesting paper from the Yale International Centre for Finance on commodities cycles and their phases, after they studied commodities futures market cycles from 1959-2004.
It states that there are 4 parts to the business cycle... 1. late expansion (where it's likely we are now), 2 early recession, 3 late recession, 4 early expansion.
During the late expansionary phase, energy & metal commodities outperform.
During the early recessionary phase breakfast commodities such as sugar, coffee, oil/gasoline, soybean oil and cocoa outperform (averages from 1959-2004 were sugar 54.3%, soybean oil 37.2%, crude oil 26.3%).
Finally, the last part of the cycle is late recessionary where agricultural commodities in general and gold do well... (i.e. Oats 31.3%, pork bellies 30.4%, sugar 26.5%, soybean oil 22.1%, gold 14%)
What is not known however is how long each stage lasts for...i.e. many say (and to which I agree) the current stage will be "stronger for longer" due to supply and demand.
Here's a link to the paper although its not the best of reads. http://www.turtletrader.com/facts-fantasies.pdf
The question is how best to position for what happens next...
Thoughts / views?!!