Since the end of the year 2019, the world has seen irreparable changes in every facet of human life, says Rowan Relton. Despite constant effort to reduce the effects of these alterations, they still linger even in 2021. Not only the pandemic has changed lives but also the worrisome incessant changes in the climate. The weather is no longer conducive, the economy is changing, and people are feeling the chaos. The trading world is not left out of this. The trading market is advancing and creating many chances for traders.
Traders like Rowan Relton have taken advantage of these opportunities to make a name for themselves. Rowan Relton is an Australian trader with fifteen years of working experience. He is known to be a successful international commodities trader and arbitrage. He has been working with Esquire Commodities Pty Limited.
Commodity trading has now included renewable commodities, farm produce, oils, and cryptocurrencies.
Here is what to expect in commodity trading in 2022
1. Growth in Carbon Credit Business
Carbon Credit trading in 2021 exceeded a million tons. Government organizations and companies are eager to reduce their carbon footprint and protect the climate.
They engage in carbon trading to reduce it through the establishment of companies that reduce their carbon usage. Projects that emit less carbon are approved to encourage this endeavor. The government wants corporate organizations to actively trade in carbon and reduce pollution.
There has been a consensus to have a standard foreign carbon market. It will be easily accessible to the general public. Intercountry trading of carbon is encouraged. There is no discrimination among trading countries because it is a level playing field. Hence, carbon trading is a commodity trading that is booming right now. Expert traders who trade in carbon will get a good return for their money, says Rowan Relton — commodity trader.
This rule is to make the 2022 carbon business a fair, profitable, and energy-saving business. The goal is to create an expansion of more than $21 trillion in the next 30 years.
2. Digital Currency Commodity Trading
Cryptocurrencies are examples of digital currencies that have evolved and are profitable over time. Government agencies have regulations in place for crypto traders. By 2022, there will be close monitoring of digital currency trading. The regulatory body has declared cryptocurrencies as purview commodities. Their values have grown exponentially and will continue to increase in the future.
It has prevented traders from illegally manipulating the crypto market to get unfair advantages.
There is a new crypto regulation that will take effect in 2021. The new rule states that there is a limit to reference contracts and all traders must comply with it. It’s predicted that the limit set by the government will have a higher trading limit than previous ones. This will lead to an increase in the number of trading in digital currencies.
3. Renewable Energy Commodity
Many key players have transitioned into renewable energy commodity trading. The oil sector has seen a surge in the number of traders willing to invest or trade in oil. As of December 2021, the numbers of renewable energy traders are higher than before. This is expected to transit into the year 2022. Investors have invested huge funds into the oil and power market. An example of future renewable commodities that will boom is energy preservation structures. Others include the generation of energy through wind and sunlight schemes. These projects will emit zero carbon to conserve the atmosphere.
Oils companies aren’t the sole traders in renewable commodity trading. Industries that use non-renewable raw materials have started using renewable materials. Hence the need for these companies to invest in renewable commodities. Companies established by the government have renewable production implementation plans in place. Every nation is striving to meet its energy target and reduce its carbon footprints. They can only do this by using renewable materials and products.
In 2022, many countries are hoping that there will be more traders of renewables and increase their revenues.
4. Stable Electricity for Data Miners
Many investors are investing in power supply to aid data mining.
Data mining requires a stable electric supply, however, its costly characteristic causes an issue. Blackouts are common during the winter and can temporarily stop the operations of data mining firms. The consequences include loss of data and being behind the schedule. As a backup plan, most companies use alternative power supplies like generators. Generators emit carbon and contribute to the depletion of the ozone layer. Therefore, industries are shifting to renewable alternative power supplies. They are advocating for sustainable alternative means of generating electricity. The demand for renewable electric supply will increase in 2022. By then, many people will use it to generate huge amounts of energy.
In 2022, the supply of hydrogen energy will be more than its supply in 2021. The reason is that hydrogen is the most plentiful and the easiest energy source. Its storage and delivery of functional energies make it a profitable commodity.
The establishment of hydrogen no emission energy plants by the governments are expected to increase in 2022.
Commodity trading in 2022 would have shifted from the traditional farm produce commodities to digital coins, energy, and electricity, says Rowan Relton. There would be a surge of traders in these areas and this will increase their values.
You need to diversify your portfolio as an investor before their values increase exponentially.