Visualizing China’s Dominance in Clean Energy Metals

The Periodic Table of Commodity Yields (2022 Edition)

For investors, 2021 was a year in which almost all asset classes ended in the green, with commodities providing some of the best performance.

The S&P Goldman Sachs Commodity Index (GSCI) was the third best performing asset class in 2021, returning 37.1% and outperforming real estate and all major equity indices.

This graph of US Global Investors tracks individual commodity returns over the past decade, ranking them based on their individual performance each year.

Soaring commodity prices in 2021

After a strong performance in commodities (especially metals) the previous year, 2021 was all about energy commodities.

The top three performers for 2021 were energy fuels, with coal providing the best annual return of any commodity over the past 10 years at 160.6%. According to US Global Investors, coal was also the least volatile commodity of 2021, meaning investors had a smooth ride as the price of fossil fuels rose.

Merchandise Returns 2021
Coal 160.61%
Crude oil 55.01%
Gas 46.91%
Aluminum 42.18%
Zinc 31.53%
Nickel 26.14%
The copper 25.70%
But 22.57%
Wheat 20.34%
lead 18.32%
Gold -3.64%
Platinum -9.64%
Silver -11.72%
Palladium -22.21%

Source: US Global Investors

The only commodities in the red this year were precious metals, which failed to remain positive despite rising commodity and asset price inflation. Gold and silver posted returns of -3.6% and -11.7% respectively, platinum -9.6% and palladium, the worst performing commodity of 2021, at -22, 2%.

Aside from precious metals, all other commodities posted positive double-digit returns, with four commodities (crude oil, coal, aluminum and wheat) posting their best single-year performances in the past decade.

Energy commodities outperform as world reopens

The partial resumption of travel and the reopening of businesses in 2021 were powerful catalysts that fueled the rise in energy commodity prices.

After crude oil fell into negative prices in April 2020, black gold made a strong comeback in 2021 as it returned 55.01% while being the most volatile commodity of the year.

Natural gas prices also rose significantly (46.91%), with natural gas prices in the UK and Europe rising even further as supply constraints came up against strong winter demand.

Although it was the second worst performer of 2020 with the transition to clean energy on the horizon, coal was the best commodity of 2021.

Strong demand for electricity has seen the return of coal in style, particularly in China, which represents a third of global coal consumption.

Base metals beat precious metals

2021 has been a tale of two metals, as precious metals and base metals have had opposite returns.

Copper, nickel, zinc, aluminum and lead, all critical to the clean energy transition, maintained positive returns from last year as electric vehicle batteries and renewable energy technologies caught the attention of investors.

Demand for these energy metals is expected to continue into 2022, with Tesla having already signed a $1.5 billion contract for 75,000 tons of nickel with Talon Metals.

2021 Metal Price Performance

At the other end of the spectrum, precious metals simply sank like a rock last year.

Investors have turned to stocks, real estate and even cryptocurrencies to preserve and grow their investments, rather than gold (-3.64%) and silver (-11.72%) traditionally favorable. Platinum and palladium also lagged other commodities, posting only -9.64% and -22.21% respectively.

Cereals bring steady gains

In a year of outperformance and underperformance, grains held their balance sheet steady and recorded their fifth consecutive year of positive returns.

Both corn and wheat provided double-digit returns, with corn hitting eight-year highs and wheat hitting prices not seen in more than nine years. Overall, these two cereals followed the upward trend of 2021 Food prices, such as the Food and Agriculture Organization of the United Nations food price index hit a 10-year high, rising 17.8% over the year.

Evolution of cereal prices 2021

As commodity, asset and consumer goods inflation surged in 2021, investors will now be keeping a close eye on a pullback in 2022. We’ll have to wait and see if the Fed’s plans to raise rates and reduce asset purchases will be effective. achieve stable commodity prices.

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