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World Bank: Global Commodity Prices to Plunge Precipitously This Year at Fastest Speed since Covid Outbreak

Published: May 25, 2023 16:50
According to the Commodity Markets Outlook report recently released by the World Bank, global commodity prices will fall at the fastest rate since the outbreak of the Covid-19 pandemic.

According to the Commodity Markets Outlook report recently released by the World Bank, global commodity prices will fall at the fastest rate since the outbreak of the Covid-19 pandemic.

Overall, the prices of commodities in 2023 are expected to plummet 21% from last year. Energy prices are expected to slump by 26% this year. But while food prices are expected to drop 8% this year, they will still be at the second-highest level since 1975. In real terms, food prices are now the highest in the past 50 years.

Nonetheless, commodity prices will remain above their average levels during 2015-2019. Ayhan Kose, Director of the Prospects Group of World Bank, said that the decline in commodity prices will help reduce the overall global inflation rate. But central banks still need to be cautious, as factors such as weak oil supplies, geopolitical crises and extreme weather could lead to higher prices and inflationary pressures.

The World Bank report also pointed out that commodity prices still face many uncertainties. For example, oil supply from Russia and OPEC could be lower than expected, tighter credit conditions could hamper the ability of oil or coal companies to increase supply elsewhere, and tighter regulation of fossil fuels could discourage related investment. Geopolitical concerns are also an important factor affecting commodity prices. Additionally, concerns over adverse weather could also push commodity prices higher, given that a drought in Europe in the summer of 2022 has severely impacted river flows and food production.

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SMM Daily Comments (May 5): LME Base Metals Rose across the Board, SHFE Nickel Plunged

SMM Daily Comments (May 9): Most LME Base Metals Closed Lower, SHFE Nickel Prices Plunge, Ferrous Metals Mostly Rose

SMM Daily Comments (May 12): SHFE Base Metals and Silver Prices Crashed, Most LME Base Metals Prices Went Down, Oil Posted 3-Day Losing Streak

SMM Daily Comments (May 16): Most Base Metals Prices Closed with Losses, SHFE Nickel, Stainless Steel Plunge, Oil Gained on G7 New Measures, US Strategic Petroleum Reserve Replenishment and Supply Concerns

SMM Daily Comments (May 17): Most Metals prices Rose, Ferrous Metals Jumped with Coking Coal soaring 3.29%,Oil Went Down on Surprise Inventory Growth, Poor China Economic Data and IEA Doubt on Russia Cheating on Output Cuts

SMM Daily Comments (May 22): Metals Prices Mostly Fell, Zinc Plunged to over 2-Year Low, Coke Slumped, Fears over US Debt Ceiling and China Demand Structural Issues Weigh on Oil

A Bull Gold Market Has Just Begun 

Fitch Ratings Raises Saudi Arabia IDR, Says World Bank Reason and High Dependence on Oil Remain a Weakness for the Country's Rating

Global Key Base Metals Face Supply Glut, Severe Oversupply for Aluminium, But There Is a Global Copper Shortage

Buffett Talks about Banking Crisis and Bank Stocks He Bought, Munger Warned Commercial Real Estate: the City Will Be Seriously Hollowed Out










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Data Source Statement: Except for publicly available information, all other data are processed by SMM based on publicly available information, market communication, and relying on SMM‘s internal database model. They are for reference only and do not constitute decision-making recommendations.

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