Commodity price volatility is a major factor in the global economy, as significant price swings in raw materials, energy, and food can transmit inflationary pressures throughout the supply chain. These shocks present a key challenge for central banks and economic forecasters who must determine whether they are temporary, supply-side events or a sign of more persistent, demand-driven inflation. A failure to correctly interpret these signals can lead to policy missteps, from overreacting to short-term noise to underreacting to a fundamental shift in the inflationary environment. Therefore, understanding the intricate link between commodity markets and the broader economy is essential for both public and private sector professionals.

This program provides a comprehensive and practical guide to inflation surveillance in a world of volatile commodity prices. Participants will gain a deep understanding of the drivers of commodity price movements, the channels through which they are transmitted to consumer prices, and the analytical tools used to forecast their impact. The course will address everything from the use of commodity price indices and futures markets as leading indicators to the challenges of policy responses and risk management. By focusing on hands-on exercises and real-world case studies, attendees will be equipped to analyze risks, anticipate price shocks, and develop more robust strategies for their organizations.

Duration: 10 days

Target Audience:

• Central Bank Economists and Researchers
• Financial Analysts and Portfolio Managers
• Commodity Traders and Risk Managers
• Government Economists and Policy Analysts
• Corporate Planners and Supply Chain Managers
• Academics and Graduate Students
• Public Policy Professionals
• Journalists and Economic Reporters
• International Financial Institution Staff
• Business Consultants

Objectives:

• Master the core principles of commodity market dynamics and price formation.
• Learn to identify the key drivers of commodity price volatility.
• Understand the channels through which commodity prices affect inflation.
• Grasp the complexities of supply shocks versus demand shocks.
• Develop proficiency in using commodity indices and futures as leading indicators.
• Explore best practices for integrating commodity data into inflation models.
• Learn about robust methods for forecasting the impact of price shocks.
• Identify the critical policy tools for responding to commodity-driven inflation.
• Develop skills in translating market analysis into actionable risk management.
• Formulate strategies for building a more resilient economic system.

Course Modules:

Module 1: Foundations of Commodity Markets

• The role of supply and demand in price formation
• The concept of commodity supercycles
• The role of a "clear and focused research question"
• The importance of a "risk and mitigation" plan
• The difference between spot and futures markets

Module 2: Drivers of Commodity Price Volatility

• The impact of a supply-side shock (e.g., weather, war)
• The use of a simple scorecard and a dashboard
• The role of a global economic cycle
• The importance of a "data story map"
• The influence of a geopolitical risk

Module 3: Commodity Price Indices

• The design and weighting of commodity indices
• The importance of a "clear and consistent reporting style"
• The use of different indices (e.g., CRB, GSCI)
• The role of a program's theory of change
• The challenges of an over-concentrated index

Module 4: Futures Markets as Indicators

• The role of futures prices in price discovery
• The use of a "stakeholder analysis"
• The concepts of contango and backwardation
• The role of a clear and compelling KPI
• The predictive power of a futures curve

Module 5: The Transmission to Inflation

• The direct pass-through to consumer prices
• The importance of a "risk and mitigation" plan
• The indirect effects on production costs
• The use of a simple scorecard and a dashboard
• The impact on inflation expectations

Module 6: Analyzing Supply vs. Demand Shocks

• The use of a "data story map"
• The identification of a supply vs. demand shock
• The implications for a monetary policy response
• The importance of a "clear and consistent reporting style"
• The role of a program's theory of change

Module 7: Inflation Forecasting Models

• The use of a commodity-augmented Phillips Curve
• The importance of a "stakeholder analysis"
• The role of a clear and compelling KPI
• The integration of commodity data into VAR and DSGE models
• The challenges of forecasting in a volatile environment

Module 8: The Role of a "Clear and Focused Research Question"

• The importance of a "risk and mitigation" plan
• The use of a simple scorecard and a dashboard
• The role of a "data story map"
• The use of a "clear and consistent reporting style"
• The use of a program's theory of change

Module 9: Policy Responses to Price Shocks

• The use of monetary policy to combat inflation
• The importance of a "stakeholder analysis"
• The role of fiscal policy and targeted subsidies
• The use of a clear and compelling KPI
• The challenges of a policy communication

Module 10: Case Studies

• Case study: The 1970s oil crisis and stagflation
• The importance of a "clear and focused research question"
• Case study: The 2008 commodity price boom
• The use of a "risk and mitigation" plan
• Case study: Recent food price volatility

Module 11: Hedging and Risk Management

• The use of futures and options for hedging
• The use of a simple scorecard and a dashboard
• The challenges of a basis risk
• The importance of a "data story map"
• The role of a "clear and consistent reporting style"

Module 12: The Future of Commodity Markets

• The impact of climate change on food and energy
• The use of a program's theory of change
• The role of the energy transition
• The importance of a "stakeholder analysis"
• The use of a clear and compelling KPI

Module 13: Data Analytics and Technology

• The use of high-frequency data for surveillance
• The importance of a "clear and focused research question"
• The role of machine learning in forecasting
• The use of a "risk and mitigation" plan
• The use of a simple scorecard and a dashboard

Module 14: The Role of a "Data Story Map"

• The importance of a "clear and consistent reporting style"
• The use of a program's theory of change
• The use of a "stakeholder analysis"
• The use of a clear and compelling KPI
• The importance of a "clear and focused research question"

Module 15: The Role of a "Risk and Mitigation" Plan

• The use of a simple scorecard and a dashboard
• The importance of a "data story map"
• The use of a "clear and consistent reporting style"
• The use of a program's theory of change
• The importance of a "stakeholder analysis"

Training Approach

This course will be delivered by our skilled trainers who have vast knowledge and experience as expert professionals in the fields. The course is taught in English and through a mix of theory, practical activities, group discussion and case studies. Course manuals and additional training materials will be provided to the participants upon completion of the training.

Tailor-Made Course

This course can also be tailor-made to meet organization requirement. For further inquiries, please contact us on: Email: info@skillsforafrica.org, training@skillsforafrica.org  Tel: +254 702 249 449

Training Venue

The training will be held at our Skills for Africa Training Institute Training Centre. We also offer training for a group at requested location all over the world. The course fee covers the course tuition, training materials, two break refreshments, and buffet lunch.

Visa application, travel expenses, airport transfers, dinners, accommodation, insurance, and other personal expenses are catered by the participant

Certification

Participants will be issued with Skills for Africa Training Institute certificate upon completion of this course.

Airport Pickup and Accommodation

Airport pickup and accommodation is arranged upon request. For booking contact our Training Coordinator through Email: info@skillsforafrica.org, training@skillsforafrica.org  Tel: +254 702 249 449

Terms of Payment: Unless otherwise agreed between the two parties’ payment of the course fee should be done 10 working days before commencement of the training.