Tradelands Economic Update – September 2022

Earlier this week, the F&BP team announced that the Purshovian Recession appears to have finally entered the recovery phase. This announcement ushers in a new direction of the already tumultuous economic trends of the year. Today’s report will focus on this news as well as the premium materials update that occurred near the end of the month.

September Market Strength Report showing only one day this month that exceeded $30M in market activity. In other words, the sell-off of items has definitely slowed down.

2022 Purshovian Recession

It’s official per the F&BP’s announcement on Discord earlier this week.  The Purshovian Recession has entered recovery mode, effectively ending six months of losses for players.  At the end, we analyzed that 21.5% of potential earnings within the Tradelands community has been lost in just six months of price reductions and sell offs.

Mining and Gemstones had its best month since April. While still negative, there are positive signs that the continual slide in prices may be stopping.
Timberfelling is currently one of the most profitable professions for the time being. Releases of new ships as well as premium vendor changes are moving prices.

This update is welcome news for some players, specifically those who are invested in material trading.  While the mining and gemstone market is still continuing to fall, it is showing strong signs of stabilizing.  However, the market for wood is already recovering, due in large part to the release of new ships and demand for timberfelling.

The Earnings Index for August started at $44.6k and showed signs of stabilizing. While still below the peak seen in April, signs were positive in terms of market stabilization.
The Earnings Index for September ends about 100 points below where it started in August, effectively moving the market into recovery mode.

For store owners, the recovery is still somewhat slow.  September earned back the losses from August, but there is still a long way to go before we will reach the record highs he saw in April.  The new items that have been released in the past few months have been underwhelming in terms of improving market conditions which is part of the struggle.

Premium Materials Update

A late month surprise update to materials is going to re-shape some of the items on the market.  The release effectively de-coupled the pricing for some materials from their premium vendor counterparts.  The result will have a large impact on wood, which is the most common premium item put on the market, but the other surprising benefactor from this change is Coal.

Coal price is $543.89. This is trending up +50.55%. The sudden incline in pricing shows the moment that the material was removed from the Premium Vendor. Despite it’s return, some holdouts will keep prices higher before it ultimately establishes a new price.
Coal volatility dramatically increased once it was pulled from the Premium Vendor. The peak volatility has already passed, so expect the price to self-correct next month. But it shows how important the pricing anchor is to the material’s stability.

In the case of Coal, it’s temporary removal from the premium vendor led to a skyrocket in prices.  The immediacy of the price correction shows just how under-priced Coal has been.  It’s used in far too many recipes and is a vital component to some ships.  It also has a drop rate between 7 – 10% , meaning a dedicated coal miner could put around 150 non-premium pieces on the market before he/she starts losing money on the transactions (and therefore raising prices).

Mahogany price is $161.38. This is trending up +6.43%. The price point is based on the value of the cargo it can be used to buy. The value of the material should never exceed the price to sell Furniture cargo from Whitecrest.
Spruce price is $2,174.81. This is trending up +24.57%. The material is benefiting from releases of new ships, and also other woods having a variant that is decoupled from the premium vendor anchor prices.

As for Wood, the premium vendor acted like a price anchor.  Remember the past report where we predicted a price fall for Pine and Spruce because their non-premium status was worthless?  Well, this change effectively reversed that, and we already see Spruce benefiting from all woods being placed on equal footing.  In fact, Mahogany is an interesting case because the new price anchor is related to its value in the furniture Premium Cargo.  It’s 10-point price increase in the past week is already visible on its index.

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