Commodities on the run
Bloomberg Commodity Spot Index is currently having its best monthly performance since March. Source: Bloomberg, Liz Ann Sonders
Top Cobalt Producers
Colbalt is essential for a series of technologies, from batteries needed for EVs to portable devices like smartphones, tablets, and laptops. The Democratic Republic of Congo (DRC) has long been the world’s largest cobalt producer, accounting for 73% of global output in 2022. However, according to the Cobalt Institute, the DRC’s dominance is projected to decrease to 57% by 2030 as Indonesia ramps up its cobalt production as a byproduct from its rapidly expanding nickel industry. Indonesia accounts for nearly 5% of global cobalt production today, surpassing established producers like Australia and the Philippines. Source: Visual Capitalist, Elements
Investors are currently quite bearish on oil and commodities
The risk of higher energy and higher commodities prices in H2 doesn't seem to be priced by the market. Meanwhile, Crude Oil futures are pushing up against new 3-month highs. Could this be the big surprise of the second part of 2023? Source: All Star Charts
Rice prices have surged to multi-year highs. And with global rice inventories projected to fall to 6-year lows in the next 6 months, prices could go even higher
Source: Barchart, FT
Oil prices are set to rise in the second half of the year, as supply struggles to meet demand, according to an International Energy Forum official.
Joseph McMonigle, secretary general of the International Energy Forum, attributes the push in oil prices to an increasing demand from China and India - two of the biggest oil consumers right after the U.S. Source: CNBC
According to the latest BofA survey, fund managers are now UNDERWEIGHT commodities
The last time fund managers were this bearish on #commodities, #crudeoil futures were literally trading below zero. Source: BofA
Saudi Arabia announced that it would extend its voluntary, unilateral oil production cut by one month, until at least August.
Moments later, OPEC+ ally Russia announced it would "voluntarily" extend its August oil export cut by 500,000 barrels a day to ensure oil market balance, Deputy Prime Minister Alexander Novak said in a statement. The 1 million-barrel-per-day Saudi production cut that began this month - in addition to existing OPEC+-agreed restrictions - will continue into August and could be extended, according to a statement issued by the state-run Saudi Press Agency. The cuts will take the kingdom's production to around 9 million barrels a day, its lowest level for several years. Source: zerohedge
Is the next Commodity Super-Cycle right around the corner?
In recent years, commodity prices have reached a 50-year low relative to overall equity markets (S&P 500). Historically, lows in the ratio of commodities to equities have corresponded with the beginning of new commodity supercycles. As Visual Capitalist's Bruno Venditti shows in the infographic, using data from Incrementum AG and Crescat Capital LLC, the relationship between commodities and U.S. equities has varied greatly over the last five decades.
