Blog

Macroeconomic shocks experienced on a global scale caused commodity markets to remain in a highly fragile structure. After the global recession caused by the epidemic, there was a great collapse in commodity prices. However, this was followed by a sharp jump in prices and high inflation figures along with expansionary monetary policies. At this point, the central banks of many major economies are trying to reduce inflation figures with tight monetary policies and aggressive interest rate hikes.

The natural gas shortage, which will be felt especially in the winter months as a result of the war-damaged Russia and Europe relations, forces many fertilizer and chemical manufacturers in Europe to reduce their production volumes. Although economies turn to alternative solutions to solve the energy crisis, it seems very difficult to find a solution to this situation in the short term. Due to the decrease in production in parallel with high energy costs, final product prices are expected to be suppressed upwards. We will see how policies aimed at reducing inflation will have an impact on these product prices.

The relationship between inflation and growth rate will affect commodity markets. In addition to this relationship, shocks that disrupt the supply-demand balance, logistics price fluctuations, changing purchasing behaviours and sanctions due to war make it very difficult for companies to make correct purchasing decisions. Each of these factors that affect the commodity markets deserves to be examined and discussed under a separate heading. We will examine these topics separately in the future.

So what does all this mean? We can say that there have been repeated cycles in commodity markets in the last 50 years. But in a world that is more interconnected in every way, understanding and interpreting changes in the market becomes even more difficult. The number of interrelated factors is increasing and we are all trying to connect the dots. While interpreting the course under the guidance of the past, we must also develop and consider our predictions about the present and the future.

At Baymineral, it is part of our job to closely follow the economic conditions and developments in the world and to try to predict the changes that will happen in the market. We work for our customers to make purchasing decisions at the right price at the right time.

Ogan Çınar

A.Sales Manager