The Lost Decade & Its Side Effect on Commodities

Abstract

Ten year has gone by since GFC : Global Financial Crisis which was considered by many economists to have been the worst financial crisis since the Great Depression of the 1930s. However, we continue to face the tremors of meltdown aftermath even to date.

Resultant impact of which was felt on commodities across sectors/segment wherein prices tanked. Palm oil was no exception to such meltdown and faced huge setback as Crude Palm Oil prices at Rotterdam crashed from the highs of $1249/mt to lows of $488/mt.

Looking back at the event gone by it can be rightly said:

"Life in not about How hard you can hit. But How Much you can get hit and still keep moving forward" - Rocky Balboa.

Certainly the sector has bounced back with vengeance there been some turbulence on the way as aftermath tremors continues to be felt globally.

Paper will revisit the GFC period to explore the relationship that existed between currency & what impact it had on commodities especially Palm Oil segment. It would also analyse the situation at present and whether GFC was GOOD/BAD/UGLY for Palm Oil segment. Not leaving out analysing the health of palm exporting countries to ponder upon impact assessment on demand of importing countries or has importing countries stopped consuming or has it started to produce on its own??? It will be explored in detail (consumption centres)

Further to that paper will explore on how exporting centres can use such crisis to its advantage by exploring terms of trade with importing centres, by exploring currency of trade (breaking US hegemony), etc. Finally concluding with events to watchful about and analysing the prevailing market structure for way forward.