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How Metals Prices Performed in 2021

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Metals prices returns 2021

How Metals Prices Performed in 2021

Looking back on what gave investors strong returns in 2021, it was the year of industrial and energy metals.

As demand for industrial goods surged, so too did their material metals. But unlike energy prices which rose across the board last year, not all metals managed positive returns.

This infographic looks at the year-over-year return on metals prices from January 1 to December 31 of 2021, using pricing data tracked by Tradingeconomics.com.

Inflation and Raw Material Demand Spur Industrial Metals

Last year saw inflation hit 30-year highs as the world’s reopening resulted in unprecedented demand for base and energy metals.

Essential materials for electric vehicle (EV) battery production like lithium and cobalt were among the top performers as EV sales continued to grow in 2021.

MetalAnnual Return in 2021
Lithium496.7%
Magnesium207.6%
Cobalt115.2%
Tin93.6%
Molybdenum90.4%
Neodynium78.3%
Aluminum38.3%
Indium32.3%
Germanium31.7%
Gallium31.6%
Nickel29.4%
Zinc28.1%
Copper26.8%
Lead14.8%
Steel7.7%
Manganese7.2%
Gold-3.5%
Platinum-10.4%
Silver-11.5%
Rhodium-20.5%
Palladium-22.0%
Iron ore-24.0%

Source: Tradingeconomics.com

Magnesium was another top performer last year, as skyrocketing coal prices impacted the metal, which uses coal as part of the feedstock in the smelting process. In addition, concerns over production suspensions in China for environmental reasons spurred magnesium prices further amidst potential shortage fears.

Iron ore was the only base metal with negative returns, with demand largely curbed by China’s slowing growth and pledge to reduce steel output in May of last year.

Lithium and Other EV Metals Outperform

Last year saw major automakers like Ford and GM commit themselves to all new car sales being zero emission by 2040, spurring an 80% rise in electric vehicle sales in 2021.

As a result, essential battery metals like lithium, cobalt, lead, and nickel were all in high demand as automakers secured these essential materials for their battery production.

The start of 2022 has also seen more positive catalysts for nickel specifically, as Tesla secured a supply deal with Talon Metals for 75,000 tonnes of nickel concentrate over six years.

PGM Prices Falter

Palladium and platinum had strong starts in the first half of the year as well, but chip shortages resulted in a slowdown in automotive production and a drop in demand for the two metals.

Both of these key platinum group metals (PGMs) finished 2021 with double-digit drawdowns, with platinum returning -10.4% and palladium returning -22.0%.

Metals analysts are mixed on whether the two metals (primarily used in automotive catalytic converters) will see a recovery in demand, which would be led by easing chip shortages and supply chain issues.

Gold and Silver Struggle to Hold Value

As the world focused on securing the necessary raw materials for the clean energy transition, gold and silver lagged behind.

Although both precious metals wavered as stores of value, returning -3.5% and -11.5% respectively, bullion sales from the U.S. mint rose by 48.4% compared to 2020.

Despite gold’s underwhelming performance while equities, cryptocurrencies, and other commodities surged, upcoming forecasted rate hikes have historically spurred reversals for the precious metal.

As 2022 has started with equity prices slumping, a potential flight to the safety of hard assets and the continuous demand for raw materials needed for the clean energy transition could set up a positive 2022 for metals.

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Mapped: How the Energy Crisis Impacts Global Food Insecurity

Exploring global food insecurity through the lens of the energy crisis and rising food costs.

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Mapped: How the Energy Crisis Impacts Global Food Insecurity

Food insecurity occurs when an individual does not have access to the adequate quantity or quality of food they require to meet their biological needs.

A disruption in supply chains, rising input costs, and inadequate weather can all have a direct impact on global food security, all of which have been in play in recent years.

Using data from the Food and Agriculture Organization (FAO) of the United Nations, let’s do a deep dive into food insecurity around the world and discuss how rising energy costs can drive up food prices, exacerbating food insecurity.

The State of Global Food Insecurity

The latest data from the FAO marks 29.3% of the entire world population to be moderately or severely food insecure, with 40% of this population experiencing severe food insecurity. Based on FAO definitions, here is what that means:

  • A moderately food insecure person experiences uncertainty about their ability to obtain food, unwillingly compromising the quantity and/or the quality of food they consume
  • A severely food insecure person lacks access to food, enduring prolonged periods of time without eating

The African continent bears most of the burden when it comes to global food insecurity, with 14 out of the top 15 most food-insecure countries being in this region. The data also paints a relatively grim picture for Middle Eastern and South American countries, while North America and Western Europe have moderate or severe food insecurity marked below 10%.

CountryPrevalence of moderate or severe food insecurity (3-year average, 2019-2021)
🇨🇬 Congo88.7%
🇸🇱 Sierra Leone 86.7%
🇸🇸 South Sudan 86.4%
🇭🇹 Haiti 82.5%
🇨🇫 Central African Republic 81.3%
🇲🇼 Malawi 81.3%
🇱🇷 Liberia 80.6%

It’s difficult to pinpoint the prevalence of African food insecurity to just one cause. Climate change, conflict in Africa, government debt, and Russia’s invasion of Ukraine have all contributed in different ways to worsening food security conditions in this region.

The Russia-Ukraine conflict, for instance, led to European aid for African countries to drop substantially, while grain exports from both Ukraine and Russia fell as ports in the Black Sea experienced disruptions. The war has also caused a disruption in fertilizer supplies, with Russia being the top exporter of fertilizer, along with a substantial rise in farming input costs as energy prices soared in 2022.

How Energy Prices Trickle Down to Food Prices

Food prices have risen substantially in the last year due to surging energy prices and supply chain disruptions. The FAO food price index, which measures the change in international prices of a basket of food commodities, saw a 14.3% increase between 2021 and 2022.

Index% change in price since 2021
General Food Price Index 14.3%
Meat 10.4%
Dairy 19.6%
Cereals 17.9%
Vegetable oils 13.9%
Sugar4.7%

As seen above, individual commodity indices followed this trend, with dairy and cereal prices bearing the brunt.

Energy costs trickle down to food prices in a variety of ways. The simple correlation between historic oil and corn prices, seen below, can paint a telling picture.

What’s interesting is that the International Monetary Fund (IMF) predicts that the effects of the 2022 energy cost crisis may not have even fully materialized yet.

According to their research, a 1% increase in fertilizer prices can boost food commodity prices by 0.45% within four quarters. With natural gas, a major input for nitrogen-based fertilizer, being 150% more expensive in 2022 than in 2021, this may be a cause for concern in the upcoming months.

Relatedly, a rise in fertilizer costs is also connected to harvest levels in upcoming seasons. Reduced use of fertilizer as a result of high costs can lead to diminished crop yields, and the IMF predicts that a 1% drop in global harvests bumps food commodity prices by 8.5%, potentially indicating that the worst of it for food prices—and for global food security—is still yet to come.

Looking Ahead to 2023

Food security is a fundamental aspect of human existence and plays an important role in the steady economic growth and prosperity of nations. While we may be tempted to believe that we’re heading in the right direction on a global scale, the FAO paints a different picture, specifically for Africa.

2030 predictions for global undernourishment forecast an 11.5% increase in hunger in Africa, while world hunger at large is predicted to decrease. With global inflation looming high and food prices still under the influence of 2022 events, addressing hunger in Africa is as crucial as ever to improve the overall well-being and development of the continent.

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What is the FIFA World Cup Trophy Made Of?

This infographic explores the history and composition of the FIFA World Cup trophy ahead of the 22nd edition of the competition.

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What is the FIFA World Cup Trophy Made Of?

Soccer is one of the world’s most popular sports with approximately 3.5 billion fans globally.

It was in Uruguay, in 1930, that the very first FIFA World Cup was held. It has occurred once every four years since then (except in 1942 and 1946 due to World War II).

This year, 92 years after its start, the 22nd FIFA World Cup tournament is scheduled to take place in Qatar. The highly anticipated event involves 32 national teams that will compete to win one of the most prestigious titles and a historic trophy.

So, what is the coveted FIFA World Cup trophy made up of?

The History and Composition of FIFA World Cup Trophies

Since its debut in the first FIFA World Cup tournament, in 1930, there have been two iterations of the World Cup trophy. Both trophies were made with a combination of metals and rare stones.

Until 1970, the Jules Rimet Trophy, designed by the French sculptor Abel Lafleur, glorified the winning team. A redesigned version of the trophy by Silvio Gazzaniga replaced the original in the 1974 FIFA World Cup tournament.

The Jules Rimet Trophy

Commonly called the Coupe du Monde (French for World Cup), the Jules Rimet trophy was officially renamed in 1946, honoring the then FIFA president Jules Rimet on his 25th Anniversary in office.

The trophy had a height of 35cm and weighed 3.8kg. It was made of gold-plated sterling silver and featured Nike, the Greek Goddess of Victory, holding an octagonal cup. The base of the trophy was made from a semi-precious stone called lapis lazuli. Golden plates were attached to each side of the base and they held the names of the winning teams from 1930 to 1970.

Since the beginning, it was agreed that the first team to win the World Cup three times would get to permanently keep the trophy. In 1970, Brazil marked its third victory by beating Italy in the finals and took the Jules Rimet trophy home.

However, in 1983, the trophy that even survived World War 2 was stolen from the Brazilian Football Confederation (CBF) headquarters in Rio de Janeiro and was never found. The only original piece of the Jules Rimet trophy in existence is the base that was replaced in 1954 to accommodate more winning-team names.

The FIFA World Cup Trophy

After handing over Abel Lafleur’s original trophy to Brazil in 1970, FIFA held a design competition in search of a new World Cup trophy. The association received 53 submissions from seven countries and Silvio Gazzaniga’s design of two human figures holding the Earth in their hands won the competition.

This new trophy is 36.5cm tall and weighs 6.17kg. It is made from 5kg of 18-karat gold and two layers of malachite. The base of the trophy is 13cm in diameter and the names of all winning teams since 1974 along with the years are engraved on it. This current iteration of the World Cup trophy can accommodate the names of 17 winning countries and years.

Unlike the Jules Rimet trophy, the current iteration of the trophy will not be handed over to a team definitively. It permanently belongs to the International Federation of Association Football (FIFA) and is secured at its Zurich headquarters.

However, a gold-plated bronze replica of the cup referred to as the World Cup Winners’ Trophy is given to every winning team.

Battle Royal: The 2022 FIFA World Cup

The 2022 FIFA World Cup tournament is long awaited by billions of passionate soccer fans.

It could be the final opportunity for two of the world’s best players—Cristiano Ronaldo, and Lionel Messi—to lift the World Cup trophy as they supposedly plan to retire from international games before the next World Cup.

This year, will your favorite national team be able to pose for a victory picture holding the golden trophy in their hands?

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