Cocoa (CC=F) and coffee (KC=F) emerged as leading performers in the commodity sector in 2024. Cocoa prices doubled to become the top-performing commodity amid supply concerns, while coffee prices surged by over 70%. Blue Line Futures chief market strategist Phil Streible joins Julie Hyman and Jared Blikre on Market Domination to analyze these market trends.
Streible characterizes soft commodities as "explosive" in 2024, noting their outperformance compared to traditional commodities and major indexes.
He identifies multiple headwinds, including increased competition, consumer demand, inclement weather, export restrictions, and, most critically, lack of infrastructure, describing these challenges as "all becoming ... drivers of these various commodity markets."
Finally, Streible explains how the rise in these commodities has contributed to the strength of the US dollar (DX=F). "Many of these commodities where they're grown at, we really don't have these ... tariff wars going on," he tells Yahoo Finance, suggesting there is "less risk" of countries becoming "retaliatory in nature," which has helped boost both the dollar and commodity prices in 2024.
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However, Streible highlights a key challenge: "A poor harvest" resulting from weather and infrastructure-related issues, particularly affecting major producing regions like Ivory Coast and Ghana.
To watch more expert insights and analysis on the latest market action, check out more Market Domination here.
This post was written by Angel Smith