Commodities: dynamics of some prices and the influence of climate change and geopolitics
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Posted by MoneyController on 04.09.2024
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In which direction is the commodities market moving? Here is an example of some commodities and some key factors affecting the commodity market today.
Price movements are taking place in the commodities market. As Isidoro Trovato points out in ‘Il Corriere della Sera’, echoing an article published in the ‘Economia’ insert and written by Ferruccio de Bortoli, not all prices are going in the same direction: on the one hand, wheat, cocoa and coffee prices are rising; on the other hand, sunflower oil and soya prices have fallen.
Trovato's summary of De Bortoli's article identifies at least two key factors in the determination of commodity prices: a) climate change, which causes phenomena such as rainfall and drought to intensify; b) geopolitics, as shown by the case of Russia, which is still a gas exporter to some countries that have condemned the invasion of Ukraine.
Let us take - as ‘Il Corriere della Sera’ does - the case of coffee: as the managing director of Illycaffè, Cristina Scocchia, explains, the price of green coffee has risen rapidly, so much so that it has doubled in the last three years and reached 245 cents per pound; among the causes, Scocchia mentions both the consequences of climate change and the interruption of transport in the Suez Canal, which causes delays.
In ‘Milano Finanza’, Gianluca Defendi mentions the CRB commodity index. In particular, Defendi looks at the commodities market from the perspective of technical analysis: from this point of view, and trying to adopt a not too short-term outlook, Defendi believes that exceeding 300 points could in fact be the signal of a bullish trend (‘a signal [...] directional’) in commodities.
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