Cotton
Year-to-date change: 33.9.%
Cotton prices may have stabilized after hitting a 140-year high on February 17th. That may be little consolation to apparel producers, who have been forced to raise prices even as they're still coping with the sluggish consumer. Cotton is still up 130% over the last year, which is also hurting emerging markets.
Last week the Apparel Exports Promotions Council of India announced soaring cotton prices are likely to crimp India's apparel exports by at least 15% in volume terms this year.
Cheddar cheese
Year-to-date change: 47.7%
Several factors have rocketed the price of cheese higher in short order. First, higher feed costs for cattle (corn, oats) have made their way to the end product.
Second, attractive slaughter cow prices appear to be encouraging much heavier culling of cows from the herd.
And third, Australia and New Zealand, which account for 40% of the world's dairy trade, have scaled back milk production forecasts for 2011 due to adverse weather negatively impacting pastures.
Cocoa
Year-to-date change: 19.2%
Alassan Ouattara, President of the Ivory Coast, has extended the country's ban on cocoa exports until March 15, 2011 amid political strife. The West African nation is the world's largest cocoa producer, accounting for about 40% of the global supply.
As a result, cocoa prices are at a 32-year high, which should make for some very expensive Easter baskets this spring.
Brent Crude Oil
Year-to-date change: 18.3%
It appears that (at least for now) Brent crude is more indicative of global supply and demand for oil than is West Texas Intermediate, as the glut of supply in Cushing, OK has caused WTI to lag other light, sweet grades.
Brent crude is now at its highest level since September 2008 as violence in Libya and the fear of contagion has the market worried about future supply. Currently, the Middle East produces 57% of the world's oil.
Corn
Year-to-date change: 7.5%
The US Department of Agriculture data shows that global corn inventories are at a 37-year low as producers are unable to grow enough grain to keep pace with consumption.
The global grain harvest for the past season was 2.18 billion metric tons, down 2.5% year-over-year. The USDA estimates that the world will consume 2.24 billion metric tons of corn this year.
Copper
Year-to-date change: 0.4%
Weakness in copper is not a good sign for global growth. Copper stockpiles tallied by the London Metal Exchange are at the highest level since August 2010, while inventories monitored by the Shanghai Futures Exchange recently jumped to a nine-month high of 161,062 tons.
Gold
Year-to-date change: -0.7%
Has the bubble burst for the yellow metal? Perhaps not yet.
Gold underperforms when real interest rates are positive and rising -- that's why gold had its worst January in twenty years.
However, gold performs well when geopolitical risks escalate, which is why this safe haven is up 4% in the last five days.
Wheat
Year-to-date change: -1.2%
The Middle East-North Africa region buys 32% of global grain shipments and Egypt is the world's largest wheat importer. Violence and riots in the area will curb demand for soft commodities, which is why corn, wheat, and soy were down last week.
On the supply side, India announced last week that it may permit wheat exports as the country may harvest a record crop this season.
Natural Gas
Year-to-date change: -9%
As the peak demand season for natural gas comes to a close, natural gas is stuck under $4/Mcf. An extreme winter has US gas inventories 3% below the 5-year average, yet traders are confident that supply will come roaring back once the drawdown season ends.
Supporting this, BHP Billiton plans to triple output from current levels in the Fayetteville shale in Arkansas, the assets that it recently acquired from Chesapeake Energy.
Coal
Year-to-date change: -8.9%
China, the US, and India are the top three consumers of coal. Growth is already slowing in India and China, and we don't think that the US is far behind.
Coal, which is down 9% year-to-date, is not a bullish leading indicator for economic strength in the US.
