Futures markets are aptly named – at any given time their prices reflect the collective wisdom of what all market participants trading a particular futures contract believe the price will be at a specific date in the future.
A quick look at end of 2023 calendar year futures prices (*see footnotes below for sources) can give clues as to what the prices of certain commodities might be at the end of 2024. Below is a look at five of the more popular commodities with their current 2023 prices first and their anticipated prices at the end of 2024 listed next.
Using the first nearby futures contract (also known as the spot futures price) for each commodity at the close of trading on the last business day of 2023, current prices were as follows:
Gold: $2,062.40/oz.
Silver: $23.853/oz.
WTI Crude Oil: $71.65/bbl.
Corn: $4.712/bu.
BitcoinBTC: $42,679.74/BTC
Using the futures contract for each commodity that will be the first nearby futures contract (spot futures) on New Year’s Eve 2024, and using the prices for these contracts from this New Year’s Eve 2023 (the same date on which the above prices were taken), one can derive the anticipated price changes that markets expect in the coming calendar year. The prices are posted below with the net year-over-year percent change in parentheses next to each for convenience:
Gold: $2,175.3/oz. (+5.5%)
Silver: $25.195/oz. (+5.6%)
WTI Crude Oil: $69.6/bbl. (-2.9%)
Corn: $5.142/bu. (+9.1%)
BitcoinBTC: $45,385/BTC (+6.3%)
Of course, no one, and no futures contract, can predict the future with certainty, and markets rarely, if ever, move in one direction for an entire year. The above values and their net percentage changes merely represent what the markets believed at the close of business on the last trading day of 2023. Nothing more and nothing less.
The only thing that is certain at this moment is that during 2024 all of the above markets are likely to see much more volatility than the net percentage changes indicated above suggest. Happy New Year to all!
*Futures Prices taken from the CME GroupCME public website via the following links:
Gold:
Silver:
WTI Crude Oil:
Corn:
Bitcoin:
