Commodity Research Bureau Index
The Commodity Research Bureau Index is a representative indicator of today's global commodity markets. First launched in 1957, The CRB Index remains one of the most respected broad-spectrum commodity benchmarks, offering insight into inflation trends, economic health, and commodity market dynamics. The CRBI measures the aggregated price direction of various commodity sectors, and is designed to isolate and reveal the directional movement of prices in overall commodity trades. This commodity index comprises a basket of 19 commodities, with 39% allocated to energy contracts, 41% to agriculture, 7% to precious metals, and 13% to industrial metals. Today, it is known as the Thomson Reuters/Jefferies CRB Index, reflecting its publishing by Thomson Reuters.
ABOUT THE CRB INDEX
CRBI is one of the most widely recognized tools for tracking the performance of the commodity markets.
First launched in 1957, the index has undergone multiple revisions in 1986 and 2005 to stay relevant.
The CRB Index has become an essential benchmark for investors, analysts, and economists who seek to understand the trends and dynamics of the global commodities market.
The CRB index tracks a basket of 19 commodities. These include Aluminum; Cocoa; Coffee; Copper; Corn; Cotton; Crude Oil; Gold; Heating Oil; Lean Hogs; Live Cattle; Natural Gas; Nickel; Orange Juice; RBOB Gasoline; Silver; Soybeans; Sugar; and Wheat.
APPLICATIONS OF THE CRBI
Inflation Indicator.
Commodity prices often rise early in inflationary cycles. An increase in the CRBI may signal rising consumer prices to come.
Economic Barometer.
The index reflects supply-demand dynamics in global commodities. Rising CRB levels often indicate global economic expansion, while falling levels may point to contraction.
Investment Benchmark.
CRBI acts as a benchmark for commodity funds and TETFs. It offers a standardized way to compare performance or to build index-tracking portfolios.
Diversification & Hedging Tool.
Investors and institutions allocate assets to commodities (via ETFs or futures) to hedge against equity volatility or currency risks.
CRBI PROS
Covers energy, metals, agriculture, etc., making it a strong macro indicator.
Inflation Gauge.
Helps policymakers, businesses, and investors anticipate inflation.
Widely Tracked.
Accepted by professionals and used in institutional-grade tools and models.
Simplicity.
Arithmetic average methodology is easy to understand and interpret.
CRBI CONS
Sensitive to supply shocks, weather, geopolitics, and global tensions.
Outdated Weighting Bias.
Some critics say the equal/near-equal weighting system doesn’t reflect modern economic importance.
Limited Commodity Coverage.
Contains 19 commodities—fewer than broader indices like BCOM (Bloomberg).
Not Tradeable Directly.
It is a benchmark, not a financial product you can buy. You must use ETFs/futures to gain exposure.