Hard commodities had a roller coaster year in 2022. While prices for some commodities stabilized after skyrocketing on the heels of the pandemic, others delivered stellar returns. Behind the volatility was a plethora of factors, including the Russia-Ukraine war, the global economic slump, and a drop in China’s demand for materials. This chart uses price data from TradingEconomics to highlight the 10 best and worst performing hard commodities of 2022. It excludes soft commodities like agricultural products and meat. Energy Crisis Sets Coal on Fire The global economic rebound of 2021, which set the fastest post-recession growth pace in the last 80 years, sparked coal prices as energy demand increased. Russia’s invasion of Ukraine ignited the spark, with coal prices exploding 157% in 2022. Consequently, coal was the best performing commodity in 2022, far outperforming the other nine top commodities by returns. Rank Commodity 2022 Returns #1 Coal 157% #2 Lithium 87% #3 Nickel 43% #4 Titanium 27% #5 Heating oil 21% #6 Uranium 12% #7 Platinum 9% #8 Molybdenum 4% #9 Iron ore 1% #10 Gold 1% Lithium (carbonate) and nickel prices continue to be supercharged by the demand for EVs and batteries. Since the beginning of 2021, lithium prices have increased 11-fold, and remain elevated at more than $70,000 per tonne. As a result of high prices for lithium, nickel, and other battery metals, the average cost of lithium-ion battery packs increased in 2022, for the first time since 2010. Battery pack prices are expected to increase in 2023 as well, before falling in 2024. The year was also positive for uranium as countries revived their nuclear power plans to combat the energy crunch. Notably, Germany extended the lifetime of three plants that were set to shut down in 2022, and Japan announced accelerated restarts for several idle reactors. The 10 Biggest Commodity Drawdowns The negative returns for most commodities can be largely attributed to prices stabilizing at lower levels after bullish runs in 2021 and the beginning of 2022. Rank Commodity 2022 Returns #1 Magnesium -54% #2 Tin -37% #3 Propane -37% #4 Rubber -26% #5 Cobalt -26% #6 Natural Gas TTF -20% #7 Naphtha -19% #8 Zinc -18% #9 Copper -16% #10 Aluminum -16% For example, magnesium prices more than halved in 2022, declining from an all-time high in September 2021. Similarly, tin prices also normalized after rising due to unprecedented demand from the electronics sector during the economic rebound from the pandemic. Source: https://elements.visualcapitalist.com/the-top-10-best-and-worst-performing-commodities-of-2022/