Commodity Markets Outlook, July 2016 : From Energy Prices to Food Prices
Most commodity price indexes rebounded in the second quarter of 2016, continuing their upward climb from January lows on improved market sentiment and tapering supplies. Oil prices jumped by more than a third due to supply outages and strong demand...
| Main Author: | |
|---|---|
| Format: | Report |
| Language: | English en_US |
| Published: |
World Bank, Washington, DC
2016
|
| Subjects: | |
| Online Access: | http://hdl.handle.net/10986/24735 |
| Summary: | Most commodity price indexes rebounded
in the second quarter of 2016, continuing their upward climb
from January lows on improved market sentiment and tapering
supplies. Oil prices jumped by more than a third due to
supply outages and strong demand. Given this rebound and
expected reduction in inventories during the second half of
the year, the crude oil price forecast for 2016 is being
raised to 43 dollars per barrel (bbl) from 41 dollars per
bbl in the April assessment, still a 15 percent drop from
2015. Metals prices are projected to decline 11 percent in
2016, a slightly larger drop than anticipated in April,
mainly driven by an ongoing surplus in the copper market.
Agricultural prices for 2016 have been revised slightly
upwards due to weather patterns in South America, but are
still expected to register a marginal decline from last
year. A large upward revision for precious metal prices of
more than 8 percentage points versus the April assessment
reflects the increased demand for safe haven assets. For
2017, a modest recovery is projected for most commodities as
demand strengthens and supply tightens. This issue of the
Commodity Markets Outlook examines the implications of low
energy prices for food prices. It finds that, given the
energy-intensive nature of agriculture, high energy prices
were an important driver of the post-2006 surge in
agricultural prices. Over 2011-2016, lower energy prices are
estimated to account for up to one-third of the projected 32
percent decline in prices of grains and soybeans. |
|---|