Supply chain challenges in a world of uncertain commodity prices
A recent article in the McKinsey Quarterly shows how the past eight years have cancelled the steady decline in commodity prices over the previous century. The decline in prices over the past century was achieved despite demand jumping by 600 to 2,000 percent, through dramatic improvements in exploration, extraction and cultivation techniques. As a result, over the 20th century, we coped with a 20-fold increase in the world economy while prices fell.
The situation going forward will not be the same. The three factors that are causing the change are: