'Mr Copper' bucks commodities gloom with double-digit returns for third year Michael Farmer, the London-based hedge fund manager and Conservative co-treasurer, has generated a third year of double-digit returns, bucking a losing trend that has dogged global commodity funds in 2013. Dubbed "Mr Copper," Mr Farmer is often responsible for shipping around 15pc to 20pc of China's copper supplies. His hedge fund group, RK Capital Management, is one of the biggest metals investment firms in the world, managing $2.4bn (£1.5bn) of assets. The group aims to generate profits from both physical trading and commodity hedge funds. Other big commodities investors have struggled in volatile markets. Clive Capital, a metals and energy investor with about $5bn under management at its peak, closed last month after three years of losses. Armajaro, a $1bn commodities fund, was reportedly up about 3pc on the year to October. Astenbeck, a $4bn commodities fund, was thought to be down 5pc earlier in the year. The base metal markets are fundamentally under-invested. There has been a focus on equities, treasuries, bonds and other markets and a general withdrawal from commodity funds in the past couple of years," he said. In our assessment, the demand for metal this year has been higher than people anticipated. There has been higher than expected consumption and very good demand. The financier said that "two underlying stories" had dominated commodity investing recently: that the Chinese economy was slowing down and that metals producers were raising production levels. "But in reality, demand in China has held up while production has not held up, particularly in copper," he said. There has been a list of production problems, from mine slides to smelter issues, that meant supplies have been lower than expected. He added that 2014 will start with "a very low stock situation" and, although it is forecast to be a year of surplus, supplies will be rapidly snapped up and "from 2016 onwards deficits can be expected."