For most small and medium-sized firms, some of the most important prices of the year are set far from the office. They are agreed on commodity exchanges in London and New York, then arrive months later as fuel receipts, energy invoices and supplier letters announcing a surcharge.
That chain has been under strain since US and Israeli strikes on Iran at the end of February disrupted shipping through the Strait of Hormuz. A spring ceasefire brought a brief reprieve before collapsing in July. In its September survey, the Bank of England’s Decision Maker Panel found 57% of firms expected to raise prices because of energy costs, while 70% expected the shock to eat into margins. These are the five commodities worth watching as 2027 budgets take shape.
1. Crude Oil and Diesel
Road transport is the quickest route from the oil market to a company’s cost base. Average UK diesel reached a record 199.5p a litre in early October, according to House of Commons Library analysis of government data, overtaking the previous high set in the summer of 2022. For much of the preceding year it had been sitting at around 143p.
The gap is significant for hauliers, couriers and trades businesses running vans. The Road Haulage Association estimates that fuel makes up about a third of road transport costs, in an industry largely made up of small and family-run firms.
Brent crude, the global benchmark, has hovered near $100 a barrel through the autumn. Because forecourt prices tend to lag movements in crude, finance teams that follow the benchmark itself can get earlier warning of what is coming. Some use charting platforms such as Metatrader 5, which combines live price charts with a built-in economic calendar for scheduled data releases. Fuel duty is the other moving part. The 5p cut introduced in 2022 is due to expire at the end of December, so the Autumn Budget later this month will be closely read by fleet operators.
2. Natural Gas and the Electricity It Prices
Gas affects even businesses that never burn it, because gas-fired power stations set the wholesale electricity price much of the time.
The House of Commons Library reports that wholesale gas prices doubled in early March, eased in early summer and then rose further, with late-August spot prices at their highest since January 2023. By mid-September, the Bank of England noted UK wholesale gas had reached 207p per therm.
Unlike households, businesses sit outside Ofgem’s price cap. Firms on flexible contracts feel these swings almost immediately, while those that fixed before the spike remain protected until renewal. For manufacturers, bakeries and hospitality venues with a contract ending this winter, the timing of that renewal is likely to matter more than usual.
3. Nitrogen Fertiliser and Food Inputs
Few businesses outside farming buy fertiliser, yet it sits behind almost every food invoice. Nitrogen fertiliser is produced using natural gas, and around 25% of global urea exports pass through the Strait of Hormuz.
Within weeks of the disruption, AHDB reported UK-produced ammonium nitrate prices up 25% and granular urea up 36%. Most arable farmers had already bought for this year’s crops, so the bigger effect is expected as growers plan for harvest 2027.
That delay matters for restaurants, caterers and food manufacturers, as ingredient costs can keep climbing after energy prices settle. The Food and Drink Federation has warned that UK food inflation could reach at least 9% before the year is out.
4. Aluminium in Packaging and Manufacturing
Aluminium runs through drinks cans, food trays, window frames and vehicle components. Gulf smelters are major suppliers, and figures from the International Aluminium Institute showed Gulf output falling to its lowest level in more than a decade in April, after two smelters were damaged in missile strikes.
The London Metal Exchange benchmark has since eased to around $3,100 a tonne. Yet the headline figure understates the pressure on buyers. Physical premiums paid by European customers have remained well above pre-conflict levels, and Emirates Global Aluminium does not expect its damaged smelter to return to full output until the first quarter of 2027. Packaging suppliers are likely to keep passing some of those costs down the chain.
5. Cocoa, a Rare Note of Relief
Not every commodity is moving against business owners. Cocoa, which set record highs in late 2024, has fallen sharply over the past year as West African supplies improved, giving chocolatiers, bakers and cafés some much-needed breathing room.
That relief could be short-lived. Ghana’s cocoa regulator, COCOBOD, has projected the country’s 2026/27 crop could fall to between 450,000 and 550,000 tonnes, down from the 750,000 tonnes projected for the previous season, citing disease, ageing farms and the likely return of El Niño weather.
Final Say on Planning Around Price Swings
Many of these raw materials, from crude oil to aluminium, are traded in US dollars. When sterling weakens, imported costs can rise even if global prices hold steady, so the exchange rate belongs in the same conversation.
The Bank of England held the Bank Rate at 3.75% in September and, according to its September minutes, expects inflation to rise further before the end of the year. For smaller firms, sensible steps include checking energy contract end dates, asking suppliers how surcharges are calculated and building a modest contingency into next year’s budget. Commodity prices cannot be controlled, but the timing of their impact can often be managed with better information.
