Tackling the challenges in commodity markets and on raw materials

Summary:

Communication published by the European Commission on 26 January 2011, which presents an overview on the action undertaken relating to challenges facing the commodity markets and raw materials.

Further information:

Commodity markets displayed increased volatility and unprecedentes movements of prices in the years leading up this Communication. To varying degrees, these price swings were reflected in consumer prices. At the hearts of these developments lies a series of changes in global supply and demand patterns as well as short term shocks in key commodity and raw material markets. Price movements were also exacerbated by various structural problems in the supply and distribution chains of different commodities. These developments occured at a time when the competitiveness of European industry requireed efficient and secure access to raw materials. The challenges of commodity prices and raw materials are closely intertwined and touch on policies in the areas of financial markets, development, trade, industry and external relations.

The European Commission took a number of initiatives. In 2008 it drew attention to the strategic importance of defining policies for raw materials by launching the raw materials initiative. Since then, it took actions within this framework to address sustainable access to raw materials both within and outside the European Union (EU), as well as on resource efficiency and recycling. It also began an in-depth reflection on commodities market in general and on food prices and security of food supply in particular. In response to the financial crisis, it launched a range of measures to improve the regulation, integrity and transparency of financial markets, and it also made a proposal for the regulation of energy markets.

This Communication presents an overview of what was achieved in each of these areas and of the steps which were planned to take the work forward.