The things in the commodity market were not quite stable in the last few years with periods of peaks and highs. The traders have been making profits from the high market volatility in the last few years, yet things change.
We shall discuss the trends of the recent years, their influence on the commodity trading for the future.
Also, you’ll learn some practical advice of how to trade commodities in 2025.
Commodity markets in the recent years
In 2022 and 2023 commodity markets experienced a boom and high volatility created a dramatic increase in profits. Naturally, this translated in a number of new entrants in commodity trading. Also, it motivated many market players to increase their trading capabilities.
Yet, the boom period didn’t last for too long. In 2024, the margins compressed. For traders it was a period of increased pressure and higher competition. The market newcomers had a hard time keeping on the flow.
It is important to keep in mind, that the recent developments do not indicate the picture for the long-term trends. The prognoses show that trading value pools will grow steadily by 2030.
According to Statista, the annual growth rate (CAGR 2025-2029) of 2.64% will result in a projected total amount of US$158.54tn by 2029.
Also, it is projected that the number of contracts in the commodity market is expected to amount to 7.37bn by 2029.
Commodity market general trends
The specifics of the commodities market is that it is a dynamic and ever-evolving sector. It will play a crucial role in the global economy in the coming years. Here is a short overview of trends to expect if you want to learn how to trade commodities in the coming years.
Customer preferences: The investor interest to commodities is increasing steadily. Investors are turning to commodities to diversify their portfolios. It also helps them hedge against inflation and market volatility. COmmodity trading is so attractive to businesses as they are able to provide a unique and stable source of returns.
Market trends: In Asia, the region’s economic growth also supports a growing interest in commodities trading. The increasing sophistication of financial markets also contributes to market interest in the development of commodity trading. The region’s leaders, like China and India are the main players in this trend. The primary interest of their investors are raw materials and energy.
Local special circumstances: The commodity market is not homogeneous. In Europe, the commodities market is under the effect of a combination of regulatory factors. The strict regulatory environment has increased the scrutiny of commodity trading. The uncertainty in the market is also supported by geopolitical tensions.
Underlying macroeconomic factors: The countries which depend directly on the commodity markets, liek the countries of Latin America feel the market fluctuations directly.
Top commodities to watch in 2025
If you want to decide which commodities to trade on in 2025, it is why to check on which of them were most performing in the previous season. The best performing commodities of 2024 were:
Cocoa (+185%) — Cocoa was the best performing commodity of 2024. The situateion with it was affected by adverse weather conditions in West Africa. The key West African producing nations suffeernd from particularly strong Harmattan winds. That led to drier climates which reduced cocoa yields. As this region accounts for 75% of global cocoa bean production, the situation resutlted in the growth of cocoa prices worldwide.
Eggs US (+107%) — The prices for eggs were influenced by mass outbreaks of avian influenza. They led to substantial reductions in the population of hens. It decreased egg production which created a supply shortage in many countries worldwide.
Coffee (+72%) — Key coffee production locales like Brazil and other South America counties suffered from weather anomalies. These were droughts and unseasonal frosts, which decreased the yields in 2024. Also, coffee is is experiencing the increased global demand from emerging markets.
Orange Juice (+65%) — Several hurricanes in the persistent citrus greening areas has led to a loss of orange yields. Orange production reached the lowest levels in over 80 years.
Germanium (+89%) — The new tariff policies, geopolitical tensions and export restrictions from China has influenced the issues in the global trade of germanium. As it is a rare element used in electronics and renewable energy technologies,
Gold (+28%) — Gold is always rising in the period of general economic uncertainty and elevated inflation. In these times, investors seek safe-haven assets like gold, silver and platinum. Also, central banks continue to buy the precious metal at a near record paces.
It is also useful to check on the worst commodities in the 2024. They were:
Iron Ore (-23%) — The drop of iron ore trading was connected to the slowdown in China’s construction and manufacturing sectors. It has led to reduced demand for steel.
Soybeans (-24%) — The favourable climate conditions in major soy producing regions worldwide increased harvests in 2024, which led to an oversupply in the market.
Cotton (-15%) — The demand for textiles and apparel last year also decreased, while the market was still under the influence of the inventory levels from previous years’ harvests.
Summing up
The commodity market is a stable business sector which is perfect for safe investment. Therefore, the studying the commodity trend to make smart investments is always important.