By Shelby Shank
Field Editor

The World Bank projected agricultural commodity prices will drop 7% this year and likely fall again in 2024.

The bank estimates corn prices will be down more than 15% this year and another 11% in 2024, according to its latest commodity markets outlook.

Wheat prices are also expected to decline 17% more this year from 2022 and nearly 6% more in 2024.Prices for soybeans and soybean oil are expected to be down sharply this year.

Assuming grain continues to flow from the Black Sea region, the bank projects world food prices will fall 8% this year and 3% more in 2024.

The projected easing in inflation is likely to not have a significant impact on food inflation, considering prices are still at their highest level since 1975. The bank’s report estimates 349 million people globally will be food-insecure this year. That is twice as many as in 2020.

“The surge in food and energy prices after Russia’s invasion of Ukraine has largely passed due to slowing economic growth, a moderate winter and reallocations in the commodity trade,” Indermit Gill, the World Bank’s chief economist and senior vice president for Development Economics, said. “But this is of little comfort to consumers in many countries. In real terms, food prices will remain at one of the highest levels of the past five decades. Governments should avoid trade restrictions and protect their poorest citizens using targeted income-support programs rather than price controls.”

The report also notes projected declines in grain prices are coming off historically high levels.

The bank’s grains price index declined nearly 5% in the first quarter of the year but is still above the pre-pandemic average from 2015 through 2019. While wheat and corn prices fell 8% in the first quarter, the price of wheat was still double what it was before the pandemic, and corn prices were 80% higher.

The report also notes there should be no further disruptions from the war in Ukraine, while good harvests in major grain producing countries like Australia, Canada, Russia and the United States contribute to lower prices.