Commodity supercycle will be done by ESG and social programs, not by resumption By

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By Ana Beatriz Bartolo – Although the economic recovery is boosting commodity prices, this movement should be limited to a few quarters. The real supercycle will likely be driven by the adoption of the ESG agenda and the implementation of more social programs in governments around the world.

That was the basis of the panel discussion “The impact of the commodities supercycle in Brazil and on investments” on Expert XP. The conversation, mediated by Carolina Oliveira, economist and fund analyst at XP, was attended by Sylvio Castro, CIO of Grimper Capital, Tony Volpon, chief strategist at Wealth High Governance, and Marcio Fontes, manager of ASA Hedge at ASA Investments.

Volpon said the rise in current prices is a short-term shock, caused by the return to activity after the reopening of many countries. However, what should sustain these values ​​is society’s demand for a more sustainable economic matrix.

He explains that this change in behavior will put pressure on a previously reduced offer, since there were not so many investments in the environmental commitment. Thus, commodities that work as a substitute for or, for example, would have high prices since the supply is not yet so developed to meet the demand.

From an energy perspective, Castro says that by 2050 it is unlikely that the energy matrix will become zero carbon, but it is possible that there will be an investment in cleaner technology and carbon credit, so that the current model ends up losing competitiveness .

That would be a slow change. Oil, for example, may have its production reduced, so that supply falls faster than demand, which would keep prices high. Even so, Castro points out that oil could be replaced by nuclear or hydrogen energy, just as coal would be replaced by .

social programs

Marcio says that the pandemic brought to society, in addition to the environmental issue, a look at the social. It is possible that governments feel pressured to maintain and expand social programs, which, as a consequence, would increase the demand for agricultural and livestock commodities.

The increase in purchasing power will be complemented by population growth. In 2050, the forecast is that the world will reach 10 billion people.

With more people and the population of emerging countries gaining greater economic power, thanks to income distribution, the trend is to improve eating habits, applying the consumption of grains and proteins.


Castro explains that this new commodity supercycle will not be parabolic, but rather continuous growth over the long term. Brazil, together with Latin America, has the capacity to benefit from this process, if there is no water restriction.

According to Volpon, Brazil has a natural competitive advantage, because it has good reserves available and has the capacity to increase production. The only question would be to develop an economic policy that allows us to take advantage of this supercycle and revert it in a positive way for the country.