Commodity Market Finance

Commodity markets have evolved substantially since the early 2000s and have become more financialized. The recent cold war between the U.S.A. and China, the outbreak of COVID-19, and Russia’s invasion of Ukraine have caused resource prices to soar, leading to greater volatility in the commodity markets. The volatility of the commodity markets has increased, and at the same time, financial markets such as the stock market, bond market, and foreign exchange market have become unstable. This has increased the linkage between the commodity and financial markets and has led to a great deal of attention being paid to the commodity markets by governments, companies, and investors.

This reprint delves into recent developments in the commodity markets and elucidates the multifaceted factors that have shaped their trajectory. It examines how the interwoven dynamics of supply and demand, geopolitics, technology, and financialization have brought about a new era in commodity trading. By providing a comprehensive survey of these developments, we aim to provide insights that will help stakeholders successfully navigate the challenges and opportunities presented by this evolving landscape.