As the economic fallout of governments’ responses to the Covid-19 pandemic is starting to be counted, commodity market analyst CRU has warned that the repercussions will be significant and that most commodities prices have not yet reached the bottom.
The coronavirus crisis has affected all markets and has made double-digit year-on-year commodity price falls the new reality, CRU analysts say in a ‘multi-commodity outlook’ insight, dated May 22.
It notes that the virus came at a time when there was cautious optimism that the trough of the commodity prices cycle had been reached. However, market optimism evaporated at the start of 2020 when the new coronavirus emerged in China – the world’s top commodities consumer. The government-imposed lockdowns in major economies around the world that followed, further dragged down prices.