The third quarter of 2026 brought a new risk into focus for commodity markets: El Niño. Climate scientists expect one of the strongest events in a generation, with consequences reaching far beyond agriculture — from drought at the Panama Canal to rising electricity demand across Asia. The energy market, meanwhile, remains structurally tight: not crude oil, but diesel and refining capacity, is the real constraint. Our Q3 2026 Quarterly Report delivers a 360° analysis across all major commodity segments.
Commodities Quarterly Report Q3 2026
Read reportThe full "El Niño Rising" report spans 40 pages of analysis across energy, industrial metals, precious metals and agriculture — with charts, performance data, and our key drivers and outlook for the fourth quarter of 2026.
Spotlights
Not crude oil, but diesel, is the real constraint
Six months after the outbreak of war between the US and Iran, one thing is clear: not crude oil supply, but diesel and refining capacity, is the pressure point in energy markets. US refining margins hit record levels, while the Rhine's water level at Kaub fell to a historic low. At the same time, global electricity demand is growing faster than the economy for the first time in three decades — driven by AI data centres and electrification.
Copper at record highs: policy, not scarcity, is driving prices
Copper hit new all-time highs in the third quarter — driven less by physical scarcity than by US tariff uncertainty, which is redirecting metal into American warehouses at record speed. China remains structurally reliant on imports, while the critical-minerals frontline is shifting from raw availability to processing and refining — from cobalt in the DRC to rare earths in China.
Gold hits record highs while wheat struggles under Black Sea disruption
Gold gained around 15% in the third quarter, supported by record central bank buying and growing concern over sovereign debt — unusually resilient given elevated real rates. In agriculture, escalating attacks on Black Sea export infrastructure drove Russian wheat exports to their lowest level since 2010, while El Niño added further pressure to the outlook for coffee, sugar and cocoa.
The Three Signals
- Diesel, not crude oil, is the real constraint
Six months into the conflict, refining capacity and product supply are proving a tighter limit on energy markets than crude availability itself — with record refining margins and structurally rising diesel crack spreads. - El Niño turns commodities into a cross-commodity story
From drought at the Panama Canal to Black Sea grain exports to electricity demand across Asia: this year's El Niño event ranks among the strongest in a generation and is expected to peak only between December and February. - Commodity equities remain historically undervalued
Despite record profits and strong cash flow generation across natural resource companies, commodity equities continue to trade below historical valuation levels — leaving significant room for a re-rating as generalist capital returns.