War in Ukraine, economic conditions, climatic conditions… all the crises have not been left behind for the authors of the CyclOpe report, the annual bible that takes stock of the commodity market.
In 2022, it is mainly the price of gas that has driven the year. With the outbreak of the war in Ukraine and the fear of a major energy crisis, their prices shot up to more than €280/MWh. But after a mild winter, Europe manages to do without Russian gas. Therefore, gas prices have fallen considerably since the beginning of the year. They even hit a two-year low in mid-May. A drop that should continue into 2023 according to the report.
Tensions on agricultural raw materials
Beyond gas, it is the entire market for agricultural raw materials that panicked in 2022. For a year and a half, the price of cocoa has risen by more than 20%, the increase is more than 40% for sugar . For corn, the fall has started, while its price had increased by 40% last year.
It is undoubtedly the wheat market that has been most affected. Its price rose 80% during the year, trading as high as 470 euros per ton in Paris, while Ukrainian exports were blocked by the Russian invasion. Since then, the agreement signed between the two countries has greatly relaxed prices, which once again fell below 250 euros per ton in mid-May.
The calm before the storm
Therefore, in the middle of 2023, it is time to relax. But the camps are in a “calm before the storm,” says Phillipe Chalmin, one of the report’s authors, in an interview with AFP. In 2023, it is particularly the price of rice that worries him. CyclOpe forecasts a price increase of 17% compared to 2022. Blame, in particular, the dwindling quantities available for export. India, for example, is expected to deliver 5 million tons less rice to the world market this year.
copper alert to follow
The other cloud on the horizon is in the metals market. The energy transition will accelerate demand, enough to fear “shortage situations, from 2025-2026, and surely around 2030,” says Philippe Chalmin.
Given the urgency of electrification, copper, a conductive metal, will play a crucial role. While large stocks have driven its price down recently, demand will skyrocket due to a lack of mining projects and highly concentrated production. In particular in Peru and Chile, two unstable countries that today account for 40% of the production of the red metal.
Source: BFM TV
