All eyes were on the weather last month as bitterly cold temperatures and extreme weather increased demand for heating fuel and threatened crops around the globe.
Hedge funds and traders were the most bullish on commodities since fall 2012, with coffee seeing the biggest boost.
Brazil, which accounts for a third of the world’s coffee production, saw one of their driest January’s on record, leading investors to triple their long positions and consumers to worry they may be paying more for their lattes in the future.
The U.S. Department of Agriculture said corn production would reach an all-time high in 2014, leading to a fall in corn futures last week after hitting the highest levels in five months.
Cattle futures hit new highs this month as the USDA forecast beef output will fall more than 5% this year, the lowest level in two decades. Milk futures also rose as California, the nation’s number one state for dairy, experienced an intense drought.
And then there was natural gas: January was the coldest start to the year since 2011, and people across a majority of the U.S. have turned up their thermostats in response. Futures soared past $6 before falling back to the $4 range, but the commodity remains volatile.
Gold traders may not have been paying attention to the weather, but the bulls were still in charge. The precious metal saw one of its best months in more than a year. After falling 28% last year, Gold is up more than 10% in 2014. Gold bets hit their highest level since late October as several economic reports came in lower than Wall Street forecast.