• An unprecedented oil-production-cut arrangement with OPEC helped lift oil prices this year, although rising production from competitive sources like U.S. shale tapered growth.
• Gold prices trended higher throughout the year as the Fed raised interest rates three times and inflation ticked above the critical 2% mark.
• Better-than-expected economic growth in China, along with labor issues in Chile and Indonesia, helped copper prices rise more than 25% for 2017.
• Agricultural commodities like London sugar and U.S. corn lagged this year as a rising U.S. dollar and inflation discouraged investors.

To come up with the top winners and losers in the commodities space this year, we took into account year-to-date performance as well as trade volume. Commodities that are intrinsically related such as Brent oil, crude oil and heating oil were treated as one general commodity type in order to avoid redundant analysis in the report.

Also included with each commodity outlined is a brief performance review of a related commodity-based ETF. In order to track returns of exchange-traded products within the commodity space on a timely basis, check out our Commodity Heatmap tool here. You can also browse through relevant ETFs within some of the major commodity subcategories on our website here.

Copper – 25.66% YTD

The best commodity performer of the year was copper with gains of more than 25% year-to-date. The performance was mainly attributed to two major factors this year – supply disruptions due to mine strikes in Chile and Indonesia, and higher Chinese demand from better-than-expected growth in the economy. Going into 2018, investors should expect to see a continuation of copper’s success considering the ongoing issues with mine operations and positive Chinese economic growth.

The top copper ETF this year is the United States Copper Index Fund (CPER) registering a gain of 22.32% year-to-date.

Gold – 9.38% YTD

Gold performed well this year and is up more than 9%, as the Federal Reserve accelerated its interest rate hike timetable with three hikes in total for 2017. A robust economy and the return of inflationary fears drove the precious metal higher as investors poured into safe-haven assets.

The best gold ETF performer year-to-date is iShares Gold Trust (IAU) with gains of 8.84%

Crude Oil – 6.74%

Oil staged a major comeback this year with crude oil up 6.74% year-to-date and Brent oil actually outperforming crude at 11.28%. This year saw successful production cuts stemming from OPEC, which helped lift oil prices globally. U.S. shale oil began to emerge as a major producer as well, which could slow down oil’s rise going into 2018. Investors can expect to see a slow movement higher for oil with prices likely staying in the high $50 to low $60-per-barrel range most of the year.

A Brent oil ETF, the United States Brent Oil Fund (BNO), was the best performer this year with gains of 8.67%.

London Sugar – -31.23%

The worst commodity performer this year has been London sugar, down more than 31% year-to-date. A preference from farmers to favor ethanol-producing crops hurt demand for sugar worldwide, while rising inflation and the resurgence of the U.S. dollar compounded selling activity. Looking ahead to 2018, investors should avoid sugar as the Fed isn’t likely to let up on interest rate hikes, which will only hurt soft commodities even more.

The Teucrium Sugar Fund (CANE) is one of the most popular sugar-based ETFs, but with a year-to-date performance of -31.69%, investors should steer clear.

Natural Gas – -29.54%

Milder-than-expected weather patterns, along with a slowing global energy demand, have dragged natural gas prices down nearly 30% year-to-date. With oil still at relatively low prices, the demand for natural gas has taken a backseat for investors who see better opportunities elsewhere. The continuing rise of alternative energy products and innovative designs making them more competitive means natural gas is facing another difficult year in 2018.

One of the worst-performing ETFs of the year has been the United States Natural Gas Fund (UNG) which fell 44.11%

U.S. Corn – -1.39% YTD

Despite a rise in global demand for ethanol products, U.S. corn struggled to make any headway this year with prices falling slightly, by 1.39%. Bumper crops, falling demand and rising inventories all took their toll on U.S. corn prices this year.

The Teucrium Corn Fund (CORN) lagged far more than the underlying commodity this year with a performance of -11.44%, as investors sold out of anything agricultural.

To stay up to date with commodity market events, come back to our News page here.

Disclaimer: All of the data has been verified on December 16, 2018.