Green Economy Commodities Atop China’s Supercycle

The surge in the prices of commodities has been unprecedented since mid-2020, predictably resulting in calls that a new supercycle is proceeding.

Supply-demand imbalances are plaguing the globe and boosting prices further. But one topic that is gaining more and more significance in 2021 is that a number of commodities required in the transition to a green economy in order to address climate change became in the focus of interest.

New indexes are either created or being created to track commodities that are required and will be relied upon in this transition.

The list of commodities in this category contains goods that are most relevant for low carbon and greener world including what the World Bank estimates by more than three billion tons of metals and minerals that will be needed for renewable energy infrastructure by 2050 in order to achieve the goals from the Paris Agreement.

New indexes will include copper, graphite, nickel, lithium and cobalt, since all are essential in the electrification process, the transition from internal combustion engines to electric vehicles, and the building of energy storage technologies.