As we slide into the end of the calendar year, performance charts are propping up and this one from trader Steve Burns showing the year to date (YTD) runs in commodities and other assets is fascinating:
Big moves higher in fossil fuels after being oversold during the first phase of the COVID pandemic, but real inflation around soft commodities like grains and our precious coffee – must have the precious – and other agriculturals which are buoying farmers here at home. That is a more dominant systemic uptrend as climate change pressures shift and change around the world.
Not shown interestingly is that iron ore is actually down 30% for the year, having started around $175 per ton, now at $120 or so after declining nearly 50% from the highs:
Another chart from Morgan Stanley shows where most of this demand is coming from, particularly the industrial metal space, with most of that building properties in China with hugely inflated debt and prices. Sound familiar?