We may be at the start of a new commodities supercycle

For the past ten years raw materials prices have languished in a bear market. But we could be about to see a new commodities supercycle that could rival those of the 1970s and 2000s.

VW ID4 electric car
Vehicle electrification will be the hallmark of this raw-materials boom
(Image credit: © Krisztian Bocsi/Bloomberg via Getty Images)

Are commodities heading back to the 1970s? For the past ten years raw materials such as oil, industrial metals and foodstuffs have languished in a bear market, says Andrew Bary in Barron’s. Yet the Bloomberg Commodity index jumped by 10% during the final quarter of 2020 and analysts at Goldman Sachs think there could be much more to come. They reckon we are heading for “a much longer structural bull market” that looks poised to “rival” the commodity supercycles of the 1970s and 2000s. The previous decade of disappointment has led to “structural underinvestment” in new mines and energy capacity. That could trigger big price spikes in the decade ahead.

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Markets editor

Alex is an investment writer who has been contributing to MoneyWeek since 2015. He has been the magazine’s markets editor since 2019. 

Alex has a passion for demystifying the often arcane world of finance for a general readership. While financial media tends to focus compulsively on the latest trend, the best opportunities can lie forgotten elsewhere. 

He is especially interested in European equities – where his fluent French helps him to cover the continent’s largest bourse – and emerging markets, where his experience living in Beijing, and conversational Chinese, prove useful. 

Hailing from Leeds, he studied Philosophy, Politics and Economics at the University of Oxford. He also holds a Master of Public Health from the University of Manchester.