Recession fears dent commodity prices

By Burhan Sansarlioglu

ISTANBUL (AA) - The selling trend in the global commodity market accelerated last week amid heightened concerns of a recession.

Estimates that the demand will decline as recession concerns in the global market caused accelerations in commodity market sales last week.

The Federal Reserve’s ongoing hawkish stance has strengthened the concern that the steps to be taken by the US central bank in the next period may put the country's economy into recession.

Analysts said monetary tightening may cause a recession and that this concern has a negative impact on markets.

China's declining real estate market and the country's COVID-19 measures are also triggering declines in the commodity market.

Last week, the gold fell 0.7%, platinum 2.7%, and silver 2.4%.

Copper finished the week with a decrease of 6.7%, aluminum 2%, nickel 10.8%, and lead 7.2%.

During the last week, Brent oil’s price fell 2.4% while natural gas prices on New York Exchange dropped 11.1%.

Natural gas prices fell last week as demand for coal rose globally.

Uncertainties about global economic growth and the fact that the measures against the COVID-19 outbreak have not been completely lifted in China continue to suppress the rise of prices, raising concerns about oil demand.

- Agricultural commodities

Last week, commodity prices in the agricultural sector also posted sharp declines.

Wheat prices hit a 3.5-month low, corn 4-month low and soybean 5-month low on Chicago Mercantile Exchange.

Wheat lost 10.5%, corn 7.9%, soybean 7.4%, cotton 17.3%, and sugar 2%.

Optimistic figures in the US wheat cultivation season and the possibility of a safe corridor for Ukraine’s wheat had positive effects on the market.

Analysts said cotton is one of the commodities accepted as a reference in global economic activity.