Last week, we outlined the five hard assets that performed the best in 2013 and noted that the pickings were slim. Overall, it was a rough year for commodities, as a number of hard assets slumped while equities roared forward. Below, we outline the five worst performing commodities of 2013 [for more commodity news and analysis subscribe to our free newsletter]:
1. Silver Down 35.7%
Silver was a major disappointment in 2013, as a number of analysts had the white metal pegged to appreciate on the year, especially given the Fed’s level of printing. But as equities reached never-before-seen highs, investors were quick to sell out of their safe haven positions. As a result, silver took a massive dive, as it is often the most volatile in the precious metal world. April marked the worst period for the metal as it sold off nearly 14% in just a few days. Though it did gain a bit of momentum in August, the gains were unable to put a dent in the 35.7% loss that silver encountered on the year.
2. Corn Down 29.7%
Forecasts of an increased U.S. output put a big squeeze on prices. As a result, a number of farmers began stockpiling corn in hopes of a price rebound; while those efforts have helped pull the crop out of its tailspin they have not erased the damage that was already done. The chart for corn has exemplified a dead cat bounce this year, as the commodity continues to bounce off lower lows.
3. Coffee Down 29.0%
Caffeine addicts may have rejoiced to see their morning cup of joe become slightly more affordable, but anyone with a long position in coffee got burned in 2013. In fact, the commodity hit a seven-year-low in November as ample supplies around the world have depressed prices. As the chart demonstrates below, coffee rarely found any positive momentum this past year, as it nose-dived its way to losses of 29% in 2013.
4. Gold Down 27.0%
Though the yellow metal did not suffer quite as much as silver, gold was still among the worst performing hard assets in 2013. Similar to silver, gold lost its safe haven appeal as investors increased their risk appetite and moved funds over to equities. This was best evidenced by the SPDR Gold Trust (GLD). That physically-backed gold product was the second largest ETF in the world when 2013 began; now it is in eighth place as it saw net outflows of more than $23 billion this year.
5. Wheat Down 24.4%
Like corn, wheat futures suffered from increased supply that was not met by increased demand. On top of that, the U.S. saw declining exports of the agricultural commodity. Wheat spent the better part of nine months in a downward trend until it finally got some momentum going at the end of September and beginning of October. From there, it sold off to its lowest point on the year, where it hovers today.
Disclosure: No positions at time of writing.