Sideways movement for industrial commodity prices in euros

The update of the monthly PricePedia commodity prices for October 2023 has been published. The dynamics of the prices of raw materials and basic goods is shown in the following graph, which illustrates the aggregate PricePedia Industrial^[1] and Energy indices.

The prices of energy commodities recorded a reduction of -2.6% compared to the previous month. The conflict between Hamas and Israel, which began with the bloody attack by Hamas last October 7, is for the moment considered by operators as a regional conflict, and the risks associated with it for the prices of energy raw materials and, in general, of commodities , appear to be relatively modest (for further information on the risks relating to the price of oil, see the analysis "The financial markets reaction two weeks after Hamas attack").
Furthermore, the decrease in euro prices in October 2023 came after the brief bullish phase that began last July, following the reduction in oil supply decided by Saudi Arabia.
As regards, however, industrial commodities, the substantial stability of prices in euros was confirmed in October. The lateral movement of prices in euros is contrasted, however, by the further reduction of -1.2% in prices in dollars, given the appreciation of the dollar against the euro. Note that compared to July 2023, the dollar in October appreciated by almost 5%.

The prices of industrial commodities

Month-over-Month trends

The recent dynamics of the prices of raw materials and basic goods are examined in depth below, considering the cyclical variations recorded in October 2023 by the individual product families compared to the average values of September 2023.

As illustrated in the graph, in October changes in commodity prices moved in an even narrower range compared to previous month. If we exclude the prices of energy and precious metals, which recorded a decrease of -2%, the percentage variations of the other product families never exceed 1% in absolute value.

Year-over-Year trends

The following graph shows the trend changes (October 2023 v October 2022) in euros of the aggregate price indices of the PricePedia product categories.

In trend terms, in October 2023, commodity prices in euros are significantly decreasing compared to the same month of the previous year. This decline varies in intensity depending on the product family considered. The strongest reductions are recorded in the prices of energy raw materials and the supply chains linked to them: Specialty Chemicals and Inorganic Chemicals products (-22.4%), Organic Chemicals (-18.2%) and Plastics and Elastomers (-17.2%). The Wood and Paper product category also recorded a strong trend decline, equal to -23%.
However, the decreases in the prices of Food (-9.4%) and Non-Ferrous metals (-8.4%) are of reduced intensity.