Global demand for commodities would remain strong in 2022; Analysts

Global demand for commodities would remain strong in 2022; Analysts

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According to analysts and traders, global demand for commodities is expected to remain robust in 2022 and underpin prices as the world economy continues to recover, although similar price jumps are unlikely.

Commodity prices from energy and metals to agricultural products rebounded sharply in 2021, with power fuels leading the rally, driven by tight supplies and a strong economic recovery as COVID-19 vaccinations staved off widespread lockdowns.

“2021 has been characterized by a huge broad-based rally. Although I believe commodity prices will remain robust, I believe the rebound in 2020 and the rally of 2021 will be exceptional years, and as such, I am not anticipating the same level of gains in the year ahead,” said Mr. Jeffrey Halley, a senior analyst at brokerage Oanda.

High prices are pushing producers to increase output, but some analysts believe that supplies of products like oil and liquefied natural gas will remain limited as these projects require years for production to come on line.

“Global LNG demand grew by 20 million tons in 2021, with Asia accounting for virtually all of this growth,” said Mr. Valery Chow, head of Asia gas and LNG research at Wood Mackenzie, noting that more than 20 percent growth in demand