"Global commodity prices are expected to decline this year at the fastest clip since the onset of the COVID-19 pandemic, clouding the growth prospects of almost two-thirds of developing economies that depend on commodity exports," the World Bank said in a statement that accompanies its latest Commodity Markets Outlook report.
Commodity prices are projected to drop by 21% in 2023 year-on-year, the report said. The price of Brent crude oil is expected to average $84 a barrel, down 16% from last year’s average.
European and US natural-gas prices are expected to halve between 2022 and 2023, with coal prices set to decrease 42% in 2023, the World Bank added.
Food prices are forecast to drop by 8% this year, but will remain at the second-highest level since 1975.
Fertilizer prices are also forecast to decrease by 37% in 2023, the biggest annual drop since 1974, while still hovering near their recent high last seen during the 2008-2009 crisis.
Despite the drops, prices of all major commodity groups will remain well above their 2015-2019 average levels, the World Bank noted.