What is market conjuncture?

Market conjuncture is the state of the market at a given point in time. Like the weather: sometimes it’s sunny and calm, sometimes it’s stormy and windy. It shows how prices, demand, and supply of goods or services are doing right now.

For example, in summer the demand for ice cream increases — that’s part of the ice cream market conjuncture.

Types of market conjuncture

1. Stable conjuncture
   Prices and demand hardly change. Example: salt market — demand is steady, fluctuations are minimal.
2. Unstable conjuncture
   Prices and demand change quickly and strongly. Example: oil market — prices can fall or rise within days due to political events.
3. Rising conjuncture
   The market is growing, prices and demand increase. For example, the electric car market in recent years.
4. Declining conjuncture
   The market is shrinking, demand and prices fall. Example: DVD player market after streaming services appeared.

What factors affect conjuncture?

• Economy: when people get richer, they buy more (e.g., cars). When incomes drop, purchases decrease.
• Politics: sanctions and trade wars affect product availability and prices.
• Technology: new tech changes preferences — remember how smartphones replaced button phones?
• Weather and seasonality: more demand for heating in winter, for air conditioners in summer.
• Global events: for example, the COVID-19 pandemic sharply changed demand for many goods.

How is market conjuncture studied?

1. Data collection: analyzing prices, sales, production.
2. Surveys and monitoring: asking consumers and sellers their opinions.
3. Expert assessments: economists and analysts give forecasts.
4. Mathematical analysis: using models to understand market trends.

Why and how to analyze conjuncture?

Analysis helps understand what is happening in the market now and what may happen tomorrow. For example, if demand grows but supply lags, prices may rise.

Businesses seeing this can increase production or raise prices. Or vice versa — if the market shrinks, costs can be cut.

Changes in conjuncture and what to do

Conjuncture constantly changes — it’s normal, markets are cyclical.

For example, at the start of the pandemic demand for plane tickets dropped sharply — airlines lowered prices and reduced flights.

Later demand recovered — prices went up.

It’s important for businesses to react quickly to such changes or risk losing money.

Real-life examples

• Oil market: summer 2020 prices fell due to the pandemic — demand dropped sharply, supply remained high. Example of unstable and declining conjuncture.

• Smartphone market: new Apple and Samsung models cause temporary demand and price growth — example of rising conjuncture.

• Agriculture: poor wheat harvest due to drought leads to price increase and shortage — example of natural factors’ impact.

Summary

Market conjuncture is a snapshot of how demand and supply work and what prices are now. It constantly changes due to many factors.

Understanding conjuncture helps businesses and investors make better decisions, avoid mistakes, and be prepared for changes.