Since mid-2020, Wall Street institutions from Goldman Sachs, JPMorgan Chase to Bank of America have generally believed that the next stage of the commodities super cycle has arrived. Three years on, energy and commodity prices are surging, delivering unprecedented gains across the board and showing no signs of slowing down anytime soon. If we follow the 4000% surge in the previous cycle, this rebound has just begun.
Phil Carr, co-founder and head of trading at The Gold & Silver Club, said: "Fast three years later, this commodities super cycle has gone from strength to strength and shows no signs of slowing down any time soon. As we enter the final period of the year Quarterly, 2023 is on track to post astronomical double- to triple-digit gains across 27 commodities ranging from metals to energy to agriculture for the third consecutive year, outperforming every other asset class there.”
He stressed that this was just the beginning.
Last week, a long list of the world's most powerful Wall Street institutions raised their price forecasts for the year ahead, saying "we are now officially entering the next phase of the commodities supercycle."
Commodities have experienced six supercycles since 1791, with each cycle averaging 12 to 24 years, and the market is now in the 7th supercycle, which began in March 2020.
The last commodities supercycle lasted from 1999 to 2011 and saw some explosive growth. Oil soared from $10 a barrel to $150, copper soared from 60 cents a pound to $4.60, gold soared from $250 an ounce to $1,921, and corn soared from $2 a bushel to $8.
"The parallels between then and now are too striking to ignore," Phil continued.
West Texas Intermediate crude oil is trading as high as $92 a barrel, up 41% since mid-June. Brent crude surged above $95 a barrel, hitting a new 2023 high. Over the past three months, the world's most-traded oil benchmark has gained an impressive 49% from its 2023 lows.
Elsewhere in energy markets, diesel prices surged above $140 a barrel, up more than 75% since the summer. The unstoppable rally in energy markets has also pulled many other commodities higher, including aluminum, copper, cobalt, nickel, lithium, palladium, platinum, zinc and uranium, which are currently trading at their highest levels since 2011.
The bullish momentum has also spread to agricultural markets, causing prices for a variety of commodities including orange juice, coffee, sugar, corn, wheat, cocoa, soybeans and rice to surge to record highs.
So, how much room for upside is left in this commodity super cycle?
Phil Outlook said that in the last super cycle from 1999 to 2011, commodity prices rose sharply by 4,000% in 12 years.
"If history is any guide, this rally is just getting started," he concluded.
The Gold & Silver Club联合创始人兼交易主管Phil Carr表示：“一晃三年过去了，这个商品超级周期已经越来越强大，而且没有任何短期内放缓的迹象。随着我们进入今年的最后一个季度，2023年有望连续第三年实现从金属、能源到农业等27种大宗商品的天文数字般的两位数到三位数的升幅，跑赢其他所有大宗商品那里的资产类别。”