Commodity prices & their future

Since commodity prices are determined by economics, here’s a link to some guys who know a boatload about econ, and an opinion on commodity prices and their future.

To sum up, more people are moving into the city (now more than 50% of the world population lives in urban areas) and the world is collectively getting wealthier. However, innovation in agri-production hasn’t kept pace. Consumerism has increased, but there are not as many farmers and, more importantly, innovation on the farm (like farming in the developed world) has not made it to countries like China yet.

The estimate on MarginalRevolution is that commodity prices will max out in about a decade or so, then start plummeting.

So, you’ll hear plenty of “sky is falling” messages from media luminaries that won’t come true in the end. Then people will forget all about the problem. But I’m getting ahead of myself here…




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