Price trends differ in the various commodity classes. Energy prices (oil and gas) have fallen considerably so far in March, while prices for soft commodities (such as wheat, coffee, corn) and industrial metals (such as aluminium, steel, iron ore) have shown gains. Since early March, the composite commodity indices has declined also due to the loss of investor interest and the prospect of Fed rate hikes. The key question is whether the underlying increase in activity amongst commodity end users will remain sustainable this year. We think that most commodity prices will rise in 2017. In the short term, prices will be challenged by Fed rate hikes. However, recent data from major metal using sectors paint a supportive picture, which provides a solid base for 2017. Strengthening activity in construction, automotive and manufacturing and the positive outlook for the global economy will be driving forces.
Monthly Commodity Update-March-2017.pdf (622 KB)
Energy: Increased downside risks
Precious metals: Gold price rally behind us
Base metals: Good availability expected to keep prices near current levels in the next few weeks
Ferrous metals: Global overcapacity not solved in the short term
Agri: Higher than expected soybean en corn harvest
