It's been one of the worst investments of 2013—and this Roubini strategist thinks it will get even worse.
Gold, copper and grain prices have dropped precipitously this year. In fact, JPMorgan's commodity team recently used that as a reason to get bullish on the space. "In a number of commodities, prices have fallen far enough for long enough to force involuntary cuts in production and to spur fresh demand," JPMorgan's note read.
In fact, JPMorgan said that "Sentiment is universally bearish," creating some real opportunities.
But Gary Clark says that sentiment is bearish for a reason. On Tuesday's "Futures Now," the commodities macro strategist at Roubini Global Economics listed the three catalysts that will continue to drive commodity prices lower.
Reason One: Declining Chinese Demand
Chinese expansion has been a huge factor that has undergirded the long run up in commodity prices. But now, "we're seeing weakening in demand growth across the board there," Clark said.
As Clark predicts in a recent note, "China's slowdown will accelerate next year, driven by a collapse in the metal-intensive, investment-driven portion of growth. Demand for metals will fall much more sharply than headline GDP growth numbers would suggest, from double-digit to low single-digit growth and possibly to zero" in the case of iron ore.
And just how important is Chinese demand? "To offset a 1 percent decline in Chinese copper or aluminum demand would require a 3 to 5 percent boost in U.S. or European demand or a 15 to 20 percent boost in Indian or Brazilian demand," Clark writes, adding: "all of which are highly unlikely."