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World Bank Expects Commodity Prices to Stay Firm
USAgNet - 04/21/2021

Global commodity prices are expected to stay firm around current levels in 2021 after recovering in the first quarter buoyed by strong economic growth, the World Bank said on Tuesday.

According to Reuters, energy prices are expected to average more than one-third higher this year than 2020, with oil averaging $56 a barrel, it said. Prices should rise to $60 a barrel in 2022, "broadly in line with their 2017-19 average."

Metals are expected to climb 30% and agricultural markets are forecast to rise nearly 14%.

Still, the World Bank said its outlook is heavily dependent on progress in containing the COVID-19 pandemic as well as policy support measures in advanced economies.

"Global growth has been stronger than expected so far and vaccination campaigns are underway, and these trends have buoyed commodity prices. However, the durability of the recovery is highly uncertain," said Ayhan Kose, World Bank group acting vice president for equitable growth, finance and institutions, and director of the prospects group.

"Emerging market and developing economies, both commodity exporters and importers, should strengthen their short-term resilience and prepare for the possibility of growth losing momentum."

Crude oil has bounced back from all-time lows reached during the initial months of the pandemic. A rapid global economic recovery and continued production cuts by the Organization of the Petroleum Exporting Countries and partners have supported prices, it said.


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