Thursday, December 1, 2022
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Impact of Afghanistan Conflict on Commodity Market

Hi, I am Rowan Relton, I am a dedicated trading professional from Australia. Today I will talk about the impact of the Afghanistan conflict on the commodity market.

We all are aware of the situation that is going on in Afghanistan between the Taliban, it needs no introduction. The situation between the two is not affecting Afghanistan but the entire world is facing consequences. Some consequences related to commodity are for the short term but others will remain for quite a long time, says Rowan Relton – commodity trader.

Short Term Consequences 

Afghanistan shares a border with some countries that produce large quantities of raw products and goods, for instance, Afghanistan shares its borders with Iran that is a big producer of oil, iron, and copper. Iran produces 2.7 million barrels of oil every day. Afghanistan also shares its borders with Pakistan and Uzbekistan. Both Pakistan and Uzbekistan produce nearly 2 million tons of cotton per year. Newly self-appointed Taliban government has stopped the imports and exports from India and Pakistan but Afghanistan is not capable of producing large quantities of goods on its own so the ban will not last long enough. So the prices of commodities that India and Pakistan export will eventually be back to a more stable price, says Rowan Relton.

Long Term Consequences

On the other hand, there are long-term consequences. Afghanistan has a hold on arguably the most exciting resources cobalt and lithium. Both of the resources have high demand due to their use in emerging technologies like EV batteries. The prices of cobalt and lithium are 50,000 US$ and 92,500yuan per tons respectively. With Taliban having the control over Afghanistan it will eventually impact the supply and the cost of both of these commodities. Afghanistan can become a much bigger party in exporting raw materials but it will cost them time and cost money to invest in the country’s infrastructure but they don’t have that much money the question appears who will invest in the country’s infrastructure. It appears China has some cards to play after they openly accepted their Taliban government. And it is also stated that the country holds about 3 trillion dollars’ worth of minerals within its complicated geography. From which many countries will try to take advantage of this by supporting the Taliban’s government. But the crude oil will have the biggest effects on its price

Wrap Up

Taliban’s control over Afghanistan is not only a topic of how it will affect commodity prices but also the massacre that has been going on people have to fight for their minimal rights women and girls are being raped daily and thousands of women are killed daily it’s time to raise our voices and let us stand together with people of Afghanistan and welcome them with all our open arms to stay in our country, says commodity trader – Rowan Relton.

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