Commodity sector performance differences

What is driving the poor performance in the commodity markets? A first pass is to break down the sector performance of the DJUBS commodity index. We have looked at the top three sectors: energy, agriculture, and industrial markets. Over the last five years, the energy markets have significantly underperformed ags and metals. This decline is related to the great natural gas decline and n oil market which has been rangebound. Every move up in oil prices has been met with greater supply. OPEC and other producers have done a good job of keeping prices with an tolerance that will allow for continued profits. The last three years have seen stronger energy markets relative to other sectors.

Ag markets have been buffeted with strong strong supply shocks. Grain markets have seen drought last year and then strong production this year. Industrial metals have fallen with the slowdown in China growth.