The year-to-date CRB Commodity Index is up 8.6%. However not all commodities are equal, and the index shows quite a lot of dispersion across the different categories, with “softs” like cocoa (up 90%) and orange juice (up 18%) rising strongly, but grains like soybeans (down 10%) and corn (-2%) performing poorly. Often the prices of individual commodities are affected by regional conditions where supply might be influenced by problems with a particular crop (e.g. too much or too little rain, the prevalence or absence of disease, etc). This is particularly the case with softs, where production is concentrated in one geographical area: e.g. cocoa (around 70% of the world’s cocoa beans come from four West African countries: Ivory Coast, Ghana, Nigeria and Cameroon), or orange juice (where Brazil dominates).

Source: Kuemmerle Research
This is less the case with metals such as copper (up 17%), which is more reflective of global industrial production, or precious metals like gold (up 11%) which often moves with more speculative trends such as perceptions of geopolitical risk, or the direction of real interest rates. Gold is also sensitive to central bank buying as well as retail demand in countries such as India, China and Japan.
And we should not forget the strength of the US dollar, which has been rising. Virtually all commodities (much to the chagrin of countries like China and Russia) are priced in USD, the only true global “reserve currency”.
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