Hot Commodities Edition 12: Happy Holidays

We wish all PanXchange friends a happy, merry, or joyous non-denominational December-to-January multicultural holiday celebration!

Today we’ll be exploring the commodity side of a few holidays this time of year.

Festivus Pole

We’re kicking this edition off with our favorite wintertime holiday. And what would Festivus be without an unadorned aluminum pole?

After a huge spike in spot aluminum prices from under $2,000 per ton to around $2,500 following sanctions on Rusal and U.S. tariffs on aluminum, prices ended the year a bit lower. Nevertheless, these ending prices still sit near the highs of the previous four years. For any newcomers unable to afford their first pole, we welcome you at our house. Come prepared to wrestle.

The Treasury Department today announced that sanctions will be removed from Rusal, so 2019 should be a great year for converts.


What Aren't Millennials Killing?!?!

Is there anything millennials aren’t killing? People are constantly complaining about all the things those young whippersnappers are heartlessly killing — everything from Applebee’sto canned tuna and napkins, and now even handshakes. Well, good news; there’s one thing you can cross off that list: Christmas trees!

Square and the National Christmas Tree Association released a report analyzing data from thousands of Christmas tree farmers, which found that real Christmas trees are top-of-mind for millennials:

“Demand previously dipped when baby boomers turned to fake trees as their kids moved out of the house. Christmas trees are now part of millennials’ hyper-awareness and affinity for all-natural and locally sourced food, beauty products, home goods, and more.”

The next few years could be a great time to be a Christmas tree and avocado toast farmer. Does avocado toast grow on a tree or in the ground?

Christmas Tree Supply

Hopefully you got your Christmas tree early — trees are in short supply this year.

Christmas trees take six to ten years to grow from a seed to harvest, and a decade ago we were right in the middle of the financial crisis, during which demand for Christmas trees was low. Farmers were left with a large amount of unsold supply, and decided not to take the risk of planting new seedlings. That, combined with a few record hot and dry summers in Oregon and Washington, left us with a supply shortage today.

According to the Square and NCTA report, Christmas tree prices saw a 17% increase from 2015 to 2017, with the average price rising from $64 to $73. With the short supply this year, prices likely continued to increase.

Prices will likely follow historical trends, peaking just after Thanksgiving and gradually dropping all the way to the 24th. But all you savvy shoppers looking to buy your Christmas at the lowest price point on Christmas Eve might be out of luck this year.


Hanukkah Oil

For those who celebrated Hanukkah in the traditional manner this year, it could be an expensive year, burning all that olive oil.

California olive oil producers had a terrible harvest this year, after warm weather in major growing areas in January and February caused olive trees to bloom, then cold weather in March froze those blooms. Many olive trees didn’t produce a single olive.

This year has been even worse, with extreme drought damaging and stunting tree growth. A few winter storms have eased the drought as of late, but most of the state is still under drought conditions. While California only represents 5% of total U.S. olive oil consumption, the market share is growing. And even a dip in that 5% could put a major dent in the pockets of those trying to burn for all eight nights.


Farm Bill and Rastafarian Christmas

Rastafari have a reason to celebrate ahead of Ethiopian Christmas on January 7th. The newly passed farm bill will make hemp farming legal nationwide.

As CBD will be legal nationwide, hemp farming is certainly the talk of the town, but will we see a boom of dryland crop farmers flooding into the newly legal hemp market?

Hemp grows well in just about every part of the U.S., aside from extreme deserts and mountains. As of now, its sowing, harvest, and curing are significantly different from those of the major grains and oilseed crops like corn, soy, and wheat. The plants are started in greenhouses and sown from seedlings, and upon harvest are cured in large warehouses to concentrate the cannabidiols in the leaves and flowers. The process is quite similar to tobacco farming, with similar planting equipment and drying and curing techniques. And with tobacco use continually declining, it should be a natural transition.

So, will we see millions of acres in the U.S. converted to hemp farming? Not likely, but the acreage that is converted should ease price pressure on other crops, with a relatively new market of cannabidiols not cannibalizing demand from grains and oilseeds.

While hemp isn’t necessarily the “Tree of Life” cannabis plant of tradition, this new farm bill will likely pave the way for continued liberalization throughout the states.

We’ll be following the hemp market very closely in the new year, as it’s bound to be a dynamic and exciting market with lots of smart minds coming together. Stay tuned for more news.


Energy usage for blockchain and particularly cryptocurrency has been a hot topic this year with news outlets competing to figure out the best country to compare electricity pricing to. Now Crypto site Chepicap is asking the important questions this year:

Support the blockchain technology revolution or buy more Christmas lights?

Blockchain or Santa — the choice is yours.

Happy Holidays to all our friends, and that’s all for the year!

-Editor in Chief Josh Yanus

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