After the surge in oil prices, what else can you buy on the cyclical commodity price increase line?

1. How far has the cyclical commodity price increase line progressed? Is it still a good time to buy?

Recently, influenced by the Middle East geopolitical situation, oil prices have experienced an epic “roller coaster” ride. After the sharp rise and subsequent fall, investors can’t help but ask: Is it still worth investing in the cyclical price increase line?

The answer is: The cyclical price increase line remains very worth paying attention to.

Based on the historical experience of multiple cyclical bull markets over the past 20-30 years (2005, 2009 after the subprime crisis, 2020-2022), the price increase of cyclical commodities often follows the rhythm of “gold starts → silver follows → copper confirms → oil ignites → agriculture concludes.” This rotation logic essentially follows global economic laws and market sentiment: When risk aversion rises, precious metals act as “safe havens”; then, with economic recovery and industrial activity picking up, industrial metals meet demand; midstream production and manufacturing fully restart, with oil—known as the mother of materials—rallying; finally, upstream price increases transmit to the consumer side, with tight supply and demand in agricultural products completing the cycle.

Currently, it’s like a relay race: the first leg (non-ferrous metals) has already run out, the second leg (petrochemicals) is taking over, and the third leg (agricultural products) is warming up behind. The story of cyclical commodity price increases is not over yet; the market is looking for the next sector to take the baton. Now is not the time to chase the already running first leg, but to position for the second and the soon-to-be-started third legs.

Table: E Fund Cyclical Commodity Price Increase Line Index Fund Products

2. Why can the cyclical commodity price increase line still be bought?

Reason 1: Producer Price Index (PPI) has not yet started to rise significantly, so the rally is not over. Historical patterns show that as long as the PPI begins to rise steadily, upstream raw material companies (like petrochemical and chemical firms) are likely to outperform the market. Currently, the PPI shows signs of stabilizing and rebounding, which may confirm this pattern again.

Reason 2: Additional capital “bullets” are still sufficient. Large funds like public mutual funds have not yet heavily allocated to sectors like chemicals and oil refining, meaning there is no rush to buy in. If the rally truly begins, more capital will flow in to take over, making further gains easier.

Reason 3: The macro narrative favors cyclical commodity price increases. The current market is playing out a macro story—geopolitical tensions have heightened resource security concerns among countries. Countries are forming their own small circles, holding resource and key capacity “cards” tightly, not easily selling. With fewer resources available, prices are naturally more likely to rise.

3. What should be bought now in the cyclical price increase line?

Direction 1: Geopolitical risk trading tools—Oil

Reason 1: The Middle East conflict has lasted longer than expected, and oil prices may continue to rise. Recently, the U.S. military targeted Iran’s oil export hub at Halek Island, extending the conflict beyond market expectations. Countries may preemptively stockpile oil to prevent supply disruptions, pushing prices higher.

Reason 2: Current oil prices have not yet priced in potential supply shortages. The current price increase does not fully account for the risk of nearly 20 million barrels per day of global transportation disruptions. If blockades persist for weeks, the global crude oil market could shift rapidly from surplus to shortage, making further price increases highly probable.

The representative index in the oil sector is the China Securities Oil & Gas Index (399439.SZ), focusing on the entire upstream industry chain in the Shanghai and Shenzhen markets, with high weights in the three major oil companies. As of February 13, 2026, the combined weight of the three oil giants in this index is about 39.95%, significantly higher than the CSI Oil & Gas Resources (27.66%) and CSI Oil & Gas Industry (27.97%), indicating the strongest beta exposure to upstream oil and gas prices.

Tracking this index is the E Fund Oil & Gas ETF (159181), with a latest scale of 209 million yuan (as of 2026-03-11). It was launched on March 19, 2026.

Direction 2: Early-stage price increase varieties—Chemicals

Reason 1: The dual-carbon policy has constrained chemical capacity supply. The 2026 government work report first proposed the target for carbon emission intensity, and during the 14th Five-Year Plan, the full implementation of “dual control of carbon emissions” will be more stringent than before. Local governments may treat carbon emissions as a rigid constraint, effectively drawing a “capacity red line” for high-energy-consuming chemical industries, making new plants difficult to build and existing low-emission plants scarce. When demand recovers, prices are more likely to rise.

Reason 2: Chemical costs are rising with oil prices, providing strong motivation for price increases. Oil is upstream of many chemical products. When oil prices go up, chemical factories’ costs naturally increase, incentivizing them to raise product prices.

Reason 3: With cost pressures, the chemical industry is expected to experience a “rise in the east and fall in the west,” with high export growth expected. After oil prices rise, energy costs in Europe, South Korea, and other overseas chemical producers surge, potentially accelerating global capacity clearing. China’s chemical industry, with its strong risk resistance, is expected to leverage scale and cost advantages to meet the global replenishment cycle.

Reason 4: The chemical industry’s current position is not high, and price increases are still in progress. Most core chemical varieties are trading at 20%-30% of their 5-year range, with mainstream varieties like PTA and organosilicon below the 25% percentile. The China Chemical Products Price Index (CCPI), reflecting industry prosperity, is at the 23rd percentile over the past five years, indicating room for further price increases.

The representative index in petrochemical and chemical sectors is the CSI Petrochemical Industry Index (H11057.CSI), with a high concentration on upstream resources, with over 92% in basic chemicals and oil refining.

The largest ETF tracking this index is the Chemical Industry ETF (516570, with connection funds A/C: 020104/020105), with a latest scale of 2.952 billion yuan (as of 2026-03-13), a high-quality tool for capturing the chemical chain’s rally.

Direction 3: Bottom reversal of the cyclical sector—Agriculture

Reason 1: Middle East conflicts have increased planting costs and threatened supply, with a risk of rising grain prices. Oil is the source of fertilizer and agricultural fuel. A sharp rise in oil prices means higher costs for fertilizers and farm machinery fuels, increasing overall crop production costs. Additionally, about one-third of global urea exports pass through the Strait of Hormuz. If this route remains blocked, global fertilizer supply could be severely impacted, potentially causing reduced yields. Meanwhile, the global grain stock-to-consumption ratio has fallen to a cyclical low of 23.8%, with fragile supply chains and potential for significant price increases, creating investment opportunities in planting.

Reason 2: Deep losses in the breeding industry signal a bottom. The pig industry is experiencing a cold winter. Currently, pig prices nationwide have fallen below 5 yuan per jin (about 0.5 kg), the lowest in over two and a half years. Worse, costs for feed (soybeans, corn) are rising, with losses exceeding 200 yuan per pig. This deep, widespread loss has persisted for nearly six months, and even leading companies like Muyuan are now losing money. Such extensive losses are a sign of industry bottoming out. Market expectations of losses may eliminate some farmers, reducing pork supply and supporting prices. Historically, 10-15 months of losses often trigger pig price rebounds; with nearly six months passed, the cycle is only halfway through, and stock market rallies tend to lead pig prices by 8-10 months. Based on this, the expected turning point is within 3-6 months, making now an ideal window to position in the breeding sector.

The representative index in agriculture is the CSI Modern Agriculture Theme Index (930662.CSI), with holdings aligned with the price increase mainline—50.1% in breeding (including 43.4% in pig breeding, 6.7% in meat chickens), 14% in planting, and 18% in feed, covering the three core sectors of pigs, planting, and feed.

Tracking this index is the E Fund Agriculture ETF (562900), with a latest scale of 144 million yuan (as of 2026-03-11), an efficient tool to grasp this round of agricultural cycle reversal.