RE:Supercycle - This Time It's Different : TD A commodities super-cycle can be described as a period of consistent and sustained price increases, usually driven by strong demand for raw materials, manufactured materials, and sources of energy, lasting more than five years. Fast forward to today and the stellar returns on global commodities we have experienced so far in 2022 have led many to believe that this may be the beginning of a new commodity super-cycle. But is this run up in prices truly the beginning a new super-cycle or a brief bull market?
At TD Asset Management Inc. (TDAM), we feel that after spending the better part of a decade in a bear market, commodity prices are likely in the early stages of a super-cycle. Many commodities are trading at near highs in nominal terms, however, when adjusting for inflation, prices in "real" terms are below levels observed at the peak of the last super cycle, and possibly more aptly, even further away from the highs observed in the 1970s.