Commodities, Volume 4, Issue 3 (September 2025) – 9 articles

We study Portugal’s household electricity retail market after legal liberalisation, quantifying market concentration (Herfindahl–Hirschman Index (HHI) and the four-firm concentration ratio (CR4)), consumer switching, and asymmetric wholesale-to-retail price pass-through. Using monthly data for January 2014–December 2019 (primary sample) and robustness checks for 2008–2022, we compute concentration indices from ERSE supplier shares, analyse switching dynamics, and estimate nonlinear autoregressive distributed lag (NARDL) models that decompose wholesale price changes into positive and negative components. The retail market remains highly concentrated during the primary window (HHI ≈ 6300–6800 using shares expressed as percentages on a 10,000 scale); switching rose after deregulation but stabilised at moderate monthly rates; and long-run pass-through is estimated at β⁺ ≈ 0.55–0.61 for wholesale increases and β⁻ ≈ 0.49 for decreases (Wald tests reject symmetry at conventional levels). Results are robust to alternative concentration metrics, exclusion of 2022, and varied lag orders. Policy implications emphasise tariff simplification, active consumer-activation measures, and regular monitoring of concentration and pass-through metrics. Full article

This study investigates the impact of the COVID-19 pandemic on the Tokyo mango market by combining transaction data from the Ota Fruit Market with Google Mobility indices. In Japan, mangoes are regarded as a luxury fruit, largely dependent on imports and associated with high domestic production costs, which positions them as premium commodities. To assess the influence of price dynamics and human mobility on mango trading volumes during the pandemic, this study employs an autoregressive distributed lag (ARDL) model. The long-run results indicate that mango demand was positively associated with increased residential activity: a 1% rise in time spent at home during the COVID era corresponded to an increase of 786 kg in trade volume. Similarly, a 1% increase in time spent in retail and recreation areas was associated with a 364 kg rise in trade volume. In contrast, time spent in grocery and pharmacy locations showed no statistically significant effect. In the short run, fluctuations in mobility patterns and price levels contributed to variations in demand, with sales volumes adjusting toward their long-run equilibrium. The mobility indices exhibited mixed short-term effects on trade volumes. Notably, the analysis revealed that mango trading volumes rebounded in 2022, coinciding with the easing of pandemic-related disruptions. Full article

As global economies accelerate their energy transitions, the photovoltaic sector faces critical challenges linked to material supply, security, and sustainability. Solar-grade silicon, enabling over 90 percent of photovoltaic technologies, has become a strategic commodity underpinning the expansion of renewable energy infrastructures. This short communication examines the evolving role of solar-grade silicon within the global energy transition, moving beyond its traditional classification as a technical material to frame it as a commodity of geopolitical and economic significance. We analyze recent price trends, regional production asymmetries, and trade dependencies, identifying key vulnerabilities in current supply chains. Although alternative photovoltaic materials such as perovskites and organics attract research interest, their commercial immaturity reinforces the centrality of silicon. The novelty of this contribution lies in treating solar-grade silicon through a commodity lens, integrating techno-economic metrics with policy and investment considerations. We highlight opportunities for reinforcing supply resilience through domestic production, circular economy strategies such as silicon recovery and reuse, and diversification of technological pathways. Our findings advocate for the inclusion of solar-grade silicon in strategic resource planning and industrial policy frameworks. Recognizing its unique position at the intersection of energy, technology, and trade is essential to achieving secure, scalable, and sustainable photovoltaic deployment worldwide. Full article

Artisanal fishing is a central pillar of the Angolan economy, particularly in the southern province of Namibe, where it serves as the primary economic activity for numerous coastal communities. However, these communities face significant challenges, including competition from expanding industrial fisheries and inadequate infrastructure at fishing centers, which hampers the storage, preservation, and transportation of catches. These limitations contribute to post-harvest losses and the reduced market value of products, despite the region’s rich diversity of pelagic and demersal resources. This study evaluated the economic viability of artisanal fishing in Namibe under three production scenarios, varying in catch levels and the inclusion of fish processing activities such as dried fish and fishmeal production. Scenario A (pessimistic) assumed a 10% reduction in production compared to the best estimates; Scenario B (intermediate) was based on average reported catches; and Scenario C (optimistic) considered a 10% increase in catches, accounting for seasonal and environmental variability. Results indicated that artisanal fishing was economically viable under all scenarios, with the Internal Rate of Return (IRR) consistently exceeding the Minimum Attractive Rate of Return (MARR) of 7.5%. IRR values ranged from 34.30% (Scenario A, without by-product commercialization) to 106.28% (Scenario C, with dried fish and fishmeal production and sales), representing a more than threefold increase in profitability. This substantial gain underscores the transformative potential of processing by-products into higher-value commodities, enabling integration into larger-scale and more liquid markets. Such value addition supports the concept of a proximity economy by promoting short production cycles, reducing intermediaries, and strengthening local value chains. Beyond financial returns, the findings suggest broader socioeconomic benefits, including local economic growth, job creation, and the preservation of traditional production knowledge. The payback period was less than four years in all cases, decreasing to 1.94 years in the most favorable scenario. By-products such as dried fish and fishmeal exhibit commodity-like characteristics due to their higher commercial value, increasing demand, and potential integration into regional and animal feed markets. In conclusion, diversifying marketing strategies and maximizing the use of fish resources can significantly enhance the economic sustainability of artisanal fishing, foster socioeconomic inclusion, and support the development of artisanal fishing communities in Namibe. Full article

Gum arabic production is a key source of income for communities in several African countries. Despite this, producing nations capture only a small share of the market value due to weak domestic markets, low price incentives, and limited value-added. Meanwhile, global demand is expected to grow from USD 1.1 billion in 2025 to USD 2.2 billion by 2035, driven by rising consumption in food, pharmaceuticals, cosmetics, and textiles. Importing countries, such as France and the US, benefit from significantly higher export prices—French export prices rose from USD 1.58/kg to USD 4.63/kg—highlighting the value added from outside producer regions. This study uses a qualitative analytical approach to examine trends and challenges in enhancing value capture within producer countries. Key strategies include local value-added, collective action, compliance with international standards, market transparency, and direct trade linkages. Findings suggest that implementing these measures could raise farmgate prices by 30–50%, retain more value within African economies, and improve access to premium export markets. In conclusion, targeted interventions are crucial for strengthening the gum arabic supply chain and promoting sustainable and equitable collection practices in producer countries. Full article

Futures and forward contracts together offer farmers of all sizes important tools for shifting and managing production risk. This risk shifting is particularly apparent in the U.S. grain complex, where the United States also has a significant export position. Because of this international reach, we argue that the futures and forward markets play a critical role in reducing world food insecurity and thus contribute to satisfying Sustainable Development Goal #2: Zero Hunger. We further argue that the presence of investors willing to take the opposite side of the farmers’ natural short hedge helps futures markets perform their key functions of price discovery and risk management. In addition to these roles, futures markets also enable farmers to finance their crops more efficiently over the production cycle, supporting operational stability. Finally, we highlight that agricultural markets in the United States are supported by significant regulation at the county, state, and federal levels. These farming regulations, coupled with federal oversight of agricultural futures markets, provide sufficient confidence that the goal of Zero Hunger is being pursued in an appropriate and effective manner, reinforcing the case for agricultural futures as a meaningful component of a broader sustainable investment strategy. Full article

The enforcement of the European Union Deforestation Regulation (EUDR) may reduce the supply of natural rubber to the European Union (EU), potentially leading to price increases due to the inelastic nature of rubber demand. This study assesses the potential financial implications for smallholder producers in Ghana, considering both the opportunities and risks associated with the evolving regulatory environment under EUDR and local market access conditions. A cost–benefit analysis (CBA) was conducted to evaluate the impact of different EUDR-related export decline scenarios on the net present value (NPV) of a standard 4-hectare plantation. The results suggest that even a minor 2.5% decline in global exports to the EU could increase the NPV by 17% for an independent compliant producer. However, a simulated COVID-19-like crisis in the fifth year of production leads to a 20% decline in NPV, reflecting vulnerability to external shocks. Based on these findings, the study identifies two priorities. This first is improving the coordination and harmonization of compliance efforts across the value chain to enable more producers to benefit from potential EUDR-related price increases. The recent creation of the Association of Natural Rubber Actors of Ghana (ANRAG) presents an opportunity to support such collective mechanisms. Second, minimizing losses during demand shocks requires the Tree Crops Development Authority (TCDA) to establish clear rules and transparent reporting for authorizing unprocessed rubber exports when factories reduce purchases due to low international prices—thus preserving market access for vulnerable producers. Together, these approaches would ensure that the potential benefits of the EUDR are realized inclusively, remain stable despite market downturns, and do not undermine value addition in domestic processing factories. Full article

The phenomenon of rising forward price volatility, both historical and implied, as maturity approaches is referred to as the Samuelson effect or maturity effect. Disregarding this effect leads to significant mispricing of early-exercise options, extendible options, or other path-dependent options. The primary objective of the research is to identify a practical way to incorporate the Samuelson effect into the evaluation of commodity derivatives. We choose to model the instantaneous variance employing the exponential decay parameterizations of the Samuelson effect. We develop efficient calibration techniques utilizing historical futures data and conduct an analysis of statistical errors to provide a benchmark for model performance. The study employs 15 years of data for WTI, Brent, and NG, producing excellent results, with the fitting error consistently inside the statistical error, except for the 2020 crisis period. We assess the stability of the fitted parameters via cross-validation techniques and examine the model’s out-of-sample efficacy. The approach is generalized to encompass seasonal commodities, such as natural gas and electricity. We illustrate the application of the calibrated model of instantaneous variance for the evaluation of commodity derivatives, including swaptions, as well as in the evaluation of power purchase agreements (PPAs). We demonstrate a compelling application of the Samuelson effect to a widely utilized auto-callable equity derivative known as the snowball. Full article

The COVID-19 pandemic had significant global impacts. In Japan, consumers refrained from going out, and dining out decreased significantly, which strongly affected the restaurant industry and resulted in a shift in food demand from eating out to home consumption. The seafood industry is no exception to this trend. This study surveyed 300 individuals with experience in seafood transactions across wholesalers, restaurants, and retailers to examine how the pandemic influenced supply and demand patterns from a distribution perspective. Results indicated that while the volume of luxury seafood handled by restaurants and wholesalers decreased, the volume handled by retailers increased. Conversely, the volume of inexpensive popular seafood declined across all three sectors. The findings suggest that some of the luxury seafood previously sold to restaurants was redirected to retailers as consumer demand shifted from dining out to home consumption during the pandemic. Full article