high-commodity-prices-the-raw-material-for-turmoil

High commodity prices: The raw material for turmoil

The run-up in commodity prices highlights the vulnerability of many industries to rising energy and raw material costs, says S&P who predicts prices could continue to rise for another five years.
In the world of higher commodity prices, corporate winners and losers fall into two distinct camps. Commodity producers are big beneficiaries, their business outlooks generally strong and their ratings stable, as scarcity and worldwide demand affect everything from corn to copper. But companies that rely heavily on grains, oil, or other commodities to make finished goods face increasing costs and thus weaker profits if the slowing US economy makes raising prices more difficult.

The fallout from high commodity prices will be unequally distributed and determined by whether one is a buyer or seller of commodities. The level of commodity input into finished goods and the ability to raise prices will determine how serious the impact...
¬ Haymarket Media Limited. All rights reserved.

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