Trafigura is not having a great year so far. The commodities trader said this week that first-half ebitda through March was down by nearly half.
More interesting than the numbers, however, were Trafigura’s comments. It noted the odd disconnect between the increasing attention that institutional investors are paying to commodities compared with dubious underlying fundamentals for industrial metals. Asset managers, however, may care more about the resilience of their portfolios than the supply and demand outlook for copper or nickel.
A glance at commodity prices certainly gives a mixed picture. The Bloomberg Commodity Index (BCOM), most popular with passive index funds, has only risen about 4 per cent this year so far, which pales against equities.