HWWI Consult GmbH
(Hamburg, April 12, 2023) In March, the HWWI Commodity Price Index continued to fall significantly, as in the previous two months. It fell by 8.3% and was thus 44.9% below the value of the same month of the preceding year. Once again, falling prices for energy raw materials were the cause of the decline in the overall Index. The Index for Energy Raw Materials fell by 9.4%. The Index for Industrial Raw Materials and the Index for Food and Beverages also declined, by 3.6% and 3.4% respectively.
The Sub-Index for Natural Gas fell by 15.4% in March and was thus 66.8% below the value of March 2022, the first month after the start of the Russian war of aggression on Ukraine. As it was already evident in the previous months, the supply situation has eased further. In the meantime, many consumer countries have been able to replace Russian natural gas with supplies from other countries such as Norway or Qatar, while at the same time consumption has been reduced. A looming threat remains the next winter without Russian imports with stronger Chinese demand at the same time.
The Sub-Index for Coal also fell by double digits in February, dropping by 17.4%. It was thus still significantly below the value of the same month last year (-50.4%). The World Bank expects a more relaxed situation and lower prices for coal in 2023 than in the previous year, although coal prices remain at a historically high level.
The downward trend in crude oil, which has been ongoing for several months, also continued in March. The Sub-Index for Crude Oil fell by 4.8%. It was thus 30.1% below the March 2022 value.
Overall, the Index for Energy Raw Materials fell by 9.4% (Euro basis: -9.3%) in March to 208.4 points (Euro basis: 222.9 points).
The Index for Industrial Raw Materials fell by 3.6% in March and was thus 31.6% below the previous year’s level.
The Sub-Index for Non-Ferrous Metals fell by 4.9% in March and was thus 29.4% below the March 2022 value. The comparatively strong decline in prices for nickel (-12.7%) and tin (-11.3%) is striking here. Nickel is currently considered a particularly valuable raw material because it is used in the production of lithium-ion batteries, which are expected to increase significantly in the coming years. Shortly after the start of the war last year, there was a considerable price increase for nickel, which was corrected in the following months, so that the price for nickel is now quite significantly below the previous year’s level (-38.4%).
Tin reached an all-time high after the start of the Ukraine war, followed by falling prices in the course of a market correction. In the last half-year, tin prices rose again, so that no trend can yet be discerned in the current falling price. Tin is important because it is considered an important raw material for modern technologies and the energy transition. Due to the small market volume, the tin price is expected to remain relatively volatile.
The Sub-Index for Agricultural Raw Materials fell by 5.9% in March. The most significant fall was in the price of sawn timber (-15.7%), which had risen by 23.4% in February. This continued the medium-term trend of falling prices for sawn timber, which are now 72.31% below the previous year’s level. The difficult economic situation in the construction industry is considered to be the cause of the falling prices. The Sub-Index for Agricultural Raw Materials was 40.3% below the previous year’s value in March.
The Sub-Index for Iron Ore and Steel Scrap rose slightly by 2.2% in March and was 26.9% below the previous year’s value.
The Index for Industrial Raw Materials reached a value of 121.5 points (Euro basis: 129.9). The index declines by 3.6% (Euro basis: -3.5%) on average for the month and was thus 31.6% lower than a year earlier.
The Index for Food and Beverages fell by 3.4% in March compared to the previous month. It was thus 14.9% below the value of the same month last year.
Overall, the Index for Food and Beverages declined by an average of 3.4% for the month (Euro basis: 3.4%) and stood at 152.5 points (Euro basis: 162.8 points).
The HWWI Commodity Price Index is a comprehensive, weekly calculated indicator of price
developments in world commodity markets, which includes the major internationally traded commodities. Since 1960, the HWWI Commodity Price Index measures the price changes in the raw material import calculation of the industrialized countries and is thus an indicator for the cost development of imported raw materials and serves among other things central banks, research institutes and international institutions for their analyses.
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