Commodity prices go down 21% in 2023, marking the biggest decline since the epidemic
According to the World Bank, food prices will drop by 3% in 2024 and 8% this year.
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According to the World Bank's most recent 'Commodity Markets Outlook' study, global commodity prices are anticipated to decline in 2023 at the fastest rate since the start of COVID-19.
After soaring by 45% in 2022, commodity prices are predicted to decline by 21% globally in 2023, casting doubt on the development prospects of nearly two-thirds of emerging economies that rely on commodity exports. However, prices will largely hold steady in 2024.
It is anticipated that agricultural prices will drop by 7% in 2023 and then further in 2024. If grain and oilseed exports from the Black Sea region stay consistent, food costs are predicted to drop by 8% this year and 3% in 2024.
However, the report stated that "real food prices in 2023 will remain at their second highest levels since 1975, only exceeded by 2022."
According to Indermit Gill, chief economist and senior vice president for development economics at the World Bank, "the spike in food and energy prices after Russia's invasion of Ukraine has largely subsided due to slowing economic growth, a moderate winter, and reallocations in the commodity trade."
But consumers in many nations find little solace in this. Real food prices will continue to be among the highest of the last fifty years. Governments should avoid trade barriers and instead use targeted income-support programmes to safeguard their most vulnerable residents, he continued.
The World Bank predicts that in 2023, energy prices will drop by 26% YoY.
This year, the average price of Brent crude oil is predicted to be $84 per barrel, 16% less than it was in 2022.
Between 2022 and 2023, natural gas costs in Europe and the US are predicted to fall in half, while coal prices are predicted to fall by 42%.
Additionally, a 37% decrease in fertiliser prices is anticipated this year, which would be the biggest annual decrease since 1976. According to the report, fertiliser costs are still not far from their most recent high, which was last reached in the food crisis of 2008–2009.