Commodities

Commodities are at the very heart of economic activity. From oil to wheat, from aluminum to coffee or rubber, we are all, in one way or another and to varying degrees, dependent on commodities. Different in terms of their physical properties but governed by common economic mechanisms, traded on global and oligopolistic markets, subject to intense competitive pressures and speculative bets, often marked by highly volatile prices, objects of geopolitical rivalries or cooperatives stra ...

Understanding the commodity markets development and dynamics is of first-order importance for the global economy, since they seem to impact the determination of a significant portion of incomes and welfare of both commodity-consuming and commodity-producing nations. Indeed, for many economies, especially developing countries, commodities remain an important source of export earnings, and commodity price volatility has a major impact on their overall macroeconomic performance. Conseq ...

Managing natural resources is a matter of great importance, both politically, socially, environmentally and economically. The subject is, though, vast and varied and sufficiently legitimate to clarify the terms of the debate. Since we cannot obviously claim to present a complete and exhaustive picture, this policy brief sets out to identify some of the substantive issues tied to natural resources, from an economist’s perspective. ...

The end of supply chain is the natural corollary of the sustained price fall of virtually all commodities observed over the past many months. If it appears premature to state exactly what is the impact of this deconsolidation in the commodities value chain, it is believed that the strategic role of physical trading is strengthening. Under such circumstances, the industrial strategies of developing countries and commodity exporters may have to evolve and, in priority, foster optimizi ...

The African endowment in mineral resources is well known and has often been a mixed blessing, according to the socalled “natural resources curse”. Bauxite, an ore that serves as a feedstock for aluminium production, is particularly present in Guinean soil but, notwithstanding its efforts to do so, this country has not yet succeeded in transforming this red treasure into a real source of social and economic development. Despite the difficult economic context and a long road ahead, th ...

The financialization of commodity chains has its origins far beyond the increased participation of investment funds on the futures markets. It should basically be understood as the consequence of the progressive inability of players that make up these commodity chains to jointly manage price risk resulting from the transfer of product from upstream to downstream. This dynamic has emerged since the late 1970s, but it is likely that the current drop in prices, if it proved sustainable ...

While an effort to regulate the financial sector has been underway since the 2008 crisis in Europe and the United States, the role of derivative commodity markets is increasing around the world, like China’s strategy in this area. Mastering the means to access these markets, the culture to understand them and techniques to use them is thus essential, both for producers and consumers. ...