USCF On Key Commodity Supply and Demand Drivers

Ryan Katz, National Sales Director of USCF Investments and Kurt Nelson, CEO and Founder of SummerHaven Index Management discuss key commodity supply and demand drivers for 2023 and beyond.

WEBCAST – Commodity Supply & Demand: Inventories Tell the Story.

Commodities returned roughly 70% since 2021 while stocks, bonds and other liquid alternative assets declined. Investors frequently ask if they’ve already missed the inflation rally after two years of strong commodity performance. Our research shows that “super-cycles” in positive commodity returns tend to last for roughly 10 years, and we identified five such periods since 1900. Each long-term bull market cycle for commodities was preceded by a large commodity return drawdown. These periods of commodity price drawdowns typically coincide with lower commodity producer profits, lower capital expenditures and reduced production capacity. During the subsequent price super-cycle, production and supply are often unable to respond quickly to increasing demand, leading to several years of inventory depletion and rising commodity prices.

Accepted for 1 CFP® / IWI / CFA CE Credit