Supply and Demand Balance
The net difference between commodity production and consumption in a given period — a surplus weakens prices; a deficit strengthens them.
The supply-demand balance (or S&D balance) is the fundamental accounting framework for commodity prices. At its simplest: when supply exceeds demand, inventories build and prices fall; when demand exceeds supply, inventories draw and prices rise.
Analysts construct supply-demand balances by modelling production forecasts (drilling rigs, crop area, mine capacity), consumption forecasts (economic growth, substitution effects), and trade flows. The implied stock change is the bottom line.
OPEC's Monthly Oil Market Report, IEA's Oil Market Report, and USDA's WASDE are the major published S&D balance updates that regularly move commodity markets.