War May Not Be Thinning Out But Commodity Prices Stay High.

Because of the rise in inflation, bottlenecks in global supply chains, and the shift in the geopolitical landscape, commodity prices are surging all over the world.

Selling cut back by farmers and strong demand by domestic millers had lifted domestic cotton futures to record high level last week on April 01. There has been a rise of 6.26 per cent and cotton futures are trading at 42,240 levels. The demand of copper was dragged down by concerns due to a renewed surge of Covid-19 inflections in China. Hence, the supply has not been improved obviously, while the consumption is weakened by the pandemic, thus increasing the destocking rate. The copper futures have gained to 818 levels up by 0.99 per cent. Similarly the price of lead has been trading upwards are closed lower at 185 seeing a jump of 1.65 per cent.

An increase in global bond yields amidst forecasts of increases interest rate around the world prevented further rise for the bullion. Though progress in peace talks between Russia and Ukraine kept its upside capped. Last fornight, gold prices appreciated by only 0.70 per cent and were trading at 52,166 per 10 grams. When mine production was reserved in few countries because of Government instructed lockdowns following the onset of the global COVID-19 pandemic. The zinc metal prices have since rose in the last fortnight by 7.84 percent and trading at 344. Aluminium prices rose on after many countries announcement to ban exports of alumina and aluminium ores to Russia as fears of supply disruption of the lightweight metal. Aluminium prices increased as much as 2.55 per cent and were trading at 281 due to China lockdown and the general inflation concerns adding to it is the on-going war. As a fear of stagflation and with rise in US bond yields the silver metal has slipped by 0.57 per cent from to ₹67876 per kg to ₹67487 per kg.

The Brent oil prices calmed extending a decline from the previous week. Russian President Vladimir said Russia will honor its energy sales to its entire customer base even those who had punished Moscow for the war against Ukraine. The Brent oil prices fell by about 3.64 per cent and were trading at $ 106 a barrel on April 1. Britain also said it would phase out the sanctions by year end, which built downward pressure on prices. The crude oil price came down by 9.82 per cent and is now trading at 101 marks as the comment from a United Arab Emirates ambassador stated that the country backing for production increases and would buoy up OPEC to consider higher output.

As nations scrambled to find other suppliers and demand peaked among investors, the value became so inflated, that it prompted the temporary closure of the London Metal Exchange for a week, which is a rarity.