CRU Group: Where Macroeconomics Meet Commodities
Connect with us

Sponsored

CRU Group: Where Macroeconomics Meet Commodities

Published

on

The following content is sponsored by CRU Group.

CRU Group

CRU Group: Where Macroeconomics Meet Commodities

Commodities are crucial to our everyday lives. From the homes we live in, to the energy we use and the food we eat—none of these would be possible without commodities.

Today’s infographic from CRU Group celebrates 50 years of commodities research and charts the prices of the materials that make our world work.

The Importance of Commodities

CRU Group has 50 years of experience in providing business intelligence on the global metals, mining, and fertilizer industries. Regularly analyzing over 50 commodities, here are CRU’s highlights on four key commodities: aluminium, copper, steel, and nitrogen.

Similarly to stocks, commodities are available for sale on the open market, and prices are susceptible to changing economic conditions.

Factors Affecting Commodity Markets

CRU Group has identified five key factors that are currently affecting commodity markets.

  1. China Stimulus: China’s economy has recently slowed and policy makers are using stimulus to support sustainable economic growth. However, the delivery of stimulus is different from the past, moving away from infrastructure investment and towards tax cuts for businesses and households.
  2. Recession: Some analysts have been warning of a recession since 2018. When the economy is in decline, commodity sectors feel the downturn more acutely, because industrial production tends to slow down and there is less demand for materials.
  3. Automotive Tariffs: During 2019, there was a sharp contraction in automotive sales and production, due to the threat of U.S. auto tariffs. However, the main driver is stricter auto emissions standards introduced in Europe and Asia, creating uncertainty for consumers.
  4. Environment: Governments continue to adopt regulations in response to rising environmental concerns. Green policies will encourage investment in renewable energy infrastructure and electric vehicles, changing the type of minerals required for these technologies.
  5. Rise of Asia: By 2035, 3.5 billion people will be living in Asian cities, an increase of 47% from today. These growing cities will necessitate large-scale infrastructure projects, which consume vast amounts of resources.
  6. These five factors will drive the economic patterns of key commodities into the future.

    Commodities Spotlight

    CRU Group has been providing business intelligence on the global metals, mining and fertilizers industries for over 50 years. Regularly analyzing over 50 commodities, CRU highlights four key commodities here:

    Aluminium

    Aluminium is one of the most in-demand metals in the world by volume, second only to steel. Its lightweight, reflective, ductile and anti-corrosion properties make it the metal of choice for a range of applications. It takes four to five tonnes of bauxite ore to produce one tonne of aluminium.

    Copper

    Copper plays a huge role in the transition to clean energy. It is a good conductor of heat and electricity, and is also ductile and recyclable. These properties make it a crucial material in electric vehicles and renewable energy infrastructure, as well as electronic goods and construction.

    In the past 5,000 years, 550 million tonnes of copper has been produced. To keep up with demand, the world will need the same amount in the next 24 years.

    Steel

    Steel is lightweight, flexible, tensile, and recyclable. Its versatility and cost-saving benefits make it a preferred material within the construction sector. Demand for steel across various sectors signals growth and is a good indicator of the health of the general economy.

    China is responsible for 51% of the world’s steel production, and accounts for 49% of its demand.

    Nitrogen

    Nitrogen is an odorless, colorless gas that makes up 78% of the earth’s atmosphere by volume. Industrial processes capture ammonia from the air and convert it to other nitrogen compounds. Urea is the most common, and is primarily used as fertilizer. The global nitrogen market is worth $62.8 billion.

    Where Next?

    How CRU Navigates Complex Commodity Markets

    Commodity prices have many different drivers, from supply and demand dynamics to exchange rate movements. Volatility is a common feature to all these commodities and up-to-date pricing and information is critical.

    CRU commodity specialists disentangle these forces to interpret and forecast price movements. They apply a range of modelling techniques, as well as their experience and expert judgement.

    For 50 years, CRU Group has tracked the commodities that drive the modern world, bringing macroeconomic insights to investors for accurate pricing—and will continue to do so for the next 50 years.

Click for Comments

Sponsored

Value in the Ground: Cartier Resources’ Chimo Mine Project

Cartier Resources (TSX-V: ECR) is advancing the Chimo Mine Gold Project in the Abitibi region of Quebec, showing its potential with past producing mines.

Published

on

Value in the Ground: Cartier Resources’ Chimo Mine Project

The sponsor of this graphic, Cartier Resources (TSX-V: ECR), has instigated an exploration strategy to increase ounces in the ground at the historic Chimo Mine in the heart of the Abitibi that continues to deliver increasing resources.

Cartier is deploying the strategy in the right region, with the right backers to find gold faster at a lower cost. This graphic provides an overview of the project’s massive potential.

Proven Endowment: The Abitibi Greenstone Belt

There are many prolific past-producing gold districts in Canada, but the Abitibi is one of the largest and well understood gold-bearing regions with readily available exploration infrastructure.

This region extends from Wawa in Northwestern Ontario to the East near Val-d’Or, Québec—a landscape that hosts some of the most productive gold mines in Canada.

Cartier’s Chimo Mine project located in the historic Abitibi Greenstone belt of Québec builds on a legacy of gold production with a project ready for investors.

Tried and Tested Exploration Strategy

The best place to find gold is where companies discovered and mined it before. Between 1964 and 1997, three companies produced 379,012 ounces of gold at the Chimo Mine.

This type of strategy is known as brownfield exploration. Brownfield exploration looks for gold in areas known to host gold mineralization. It offers investors less risk, reducing the amount of uncertainties a company faces.

Ounces in the Ground: Growing a Gold Resource

Cartier delivered its first-ever resource estimate within three years and proved the value at Chimo. In November 2019, the company published its first mineral resource estimate of the central gold corridor on the Chimo Mine property.

It reported Indicated resources of 481,280 ounces of gold and Inferred resources of 417,250 ounces of gold. This resource estimate came from only one-third of the property.

This was just the beginning for Cartier Resources and the Chimo Mine.

In 2021, Cartier upgraded its resource estimate with drilling from its North and South corridor. The company increased the indicated resources to 684,000 oz Au (6,616,000 tonnes at 3.21 g/t Au) and the inferred resources to 1,358,000 oz Au (15,240,000 tonnes at 2.77 g/t). This gives the property over 2 million ounces of gold in the heart of the Abitibi.

Why Invest in Chimo?

Cartier Resources has consistently applied an exploration strategy to develop and increase the known gold resources at the Chimo gold mine.

It built on the foundations of a proven past producer and continued exploration success to discover more gold. In the heart of a safe and established mining jurisdiction, Cartier has put the Chimo Mine back on the Abitibi gold map.

Continue Reading

Sponsored

Visualizing the Rise of Cryptocurrency Transactions

As cryptocurrency transactions rise, merchants are looking to position themselves to take advantage of this new wave of crypto spenders.

Published

on

daily crypto transactions

Visualizing the Rise of Cryptocurrency Transactions

After Bitcoin and cryptocurrency’s wild bull run in late 2020 and early 2021, many holders are now using cryptocurrencies for their intended purpose: payments.

Every day, approximately $12 billion are transferred across the Bitcoin, Ethereum, and Litecoin blockchains, with millions of people using cryptocurrency for payments daily.

This graphic sponsored by CoinPayments looks at the rising transactions of the Bitcoin, Ethereum, and Litecoin networks.

Cryptocurrency Transactions are Rising in Value and Number

While prices are often the focus when crypto is in the spotlight, transaction counts show how much a network is being used as a medium of exchange. In just over five years, daily transactions across the Bitcoin, Ethereum, and Litecoin networks increased sixfold, from just 250,000 to more than 1.5 million transactions a day.

In mid-2017, Ethereum overtook Bitcoin in daily transactions as ETH was necessary to participate in ICOs (initial coin offerings), which fueled much of the speculation in the 2017 price run. With Ethereum still hosting thousands of ERC-20 and ERC-721 tokens on its blockchain today, its transaction counts have grown to be much higher compared to Bitcoin and Litecoin’s.

Along with crypto’s rising transaction numbers, the average USD value per transaction has increased by a minimum of 4x over the past five years.

YearAverage Value per Bitcoin TransactionAverage Value per Ethereum TransactionAverage Value per Litecoin Transaction
2016$2,426$588$1,357
2021$32,943$19,139$5,458

Source: Coin Metric
2021 figures as of July 13th, 2021

Crypto Spenders are Searching for Merchants

As transaction counts and values rise, merchants play a vital part in pushing forward the adoption of digital currencies for payments.

Many cryptocurrency users consider merchant adoption as a key barometer of success for crypto adoption. While companies like AT&T, Namecheap, and Overstock already accept crypto payments, there are still many businesses around the world which don’t offer cryptocurrency as a method of payment.

In a survey of over 8,000 U.S. consumers, 66.7% of crypto owners and 54.2% of non-owners said that not enough merchants accept cryptocurrency. Along with this, 47% of crypto owners said they seek out merchants that accept crypto for purchases, indicating clear demand for more crypto-accepting businesses.

How Can Merchants Make the Most of the Crypto Boom?

As the world embraces crypto, merchants need the in-store and online tools to be part of this next wave of commerce. Accepting crypto opens merchants up to an untapped audience of new consumers, eager to spend their crypto.

CoinPayments makes it easy to start accepting crypto payments at online checkout and with POS systems, with features like auto-coin conversion and over 2,000 coins supported.

Find out more about how the crypto market is growing, adapting to consumer needs, and the opportunity it presents to merchants around the world.

Continue Reading

Subscribe

Popular