The commodity market boom is over, the report said. Since early 2020, more analysts have been advocating the idea of a new commodities supercycle, with an economic recovery fueled by low interest rates and pandemic-led fiscal stimulus, and as investment in decarbonization projects accelerates to meet net-zero targets.
Global manufacturing is cracking, with the July
Oil and agricultural prices have also fallen from March highs, with the key
The main debate is how high prices are destroying demand amid fears of an inflationary recession and how much commodities are traded based on their own fundamentals and still a tight supply/demand balance. If oil and wheat remain high despite economic weakness, further damage could be done to the global economy and, ultimately, commodity demand, pointing to the urgency of OPEC+ to attract additional barrels and the US to strategic petroleum reserves to flow, the report said.
Dated Brent remains in the triple digits after peaking at nearly $140/b in March and well above $80/b at the start of 2022, while Russian wheat of 12.5 percent FOB in the Black Sea is also still well above above the level it is at the beginning of the year.
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