2023 Commodity Outlook: An Underinvested Supercycle

Just as commodity markets have been dominated by the dollar in 2022, Goldman Sachs Commodities analysts expect them to be shaped by underinvestment in 2023. From a fundamental perspective, the setup for most commodities next year is more bullish than it has been at any point since Goldman Sachs Commodities analysts first highlighted the supercycle in October 2020. Across commodity markets, the rapid rise in the cost of capital lowers the incentive to hold either physical inventories or paper risk, distorting price discovery as financial markets react faster than the real economy, creating markets that are simply unprepared for sequential growth in 2023.