T O RO HE E W W T H D LBD LR KA N K A NB Global 77782 Global Development Commodity Wheat Monthly Prices($/metric ton) 450 4 350 3 Finance Markets 250 2 150 1 50 0 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan Source: World Bank Sou Wheat Monthly Prices ($/metric ton) Cocoa Annual Prices ($/metric ton) Charting Review 450 a Global and Recovery price forecast Monthly Prices($/metric ton) 450 4 Current Constant 2000 COCOA ICCO ($/kg) Forecast 4 350 350 3 3 A I : Companion R E V I E W , A to 250 N A L Y S I S , Economic Global A N D O U TProspects L O O K 2010 250 2 150 1 Constant 2000 2009 2 1 150 Current 50 50 0 0 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 1980 1990 Jan-00 1985 Jan-02 1995 2000 Jan-04 Jan-06 2010 Jan-08 2005 2015 2020 Jan-10 19 Source: World Bank Source: Source:World WorldBank Bank So 450 Current Constant 2000 Cotton 4 Current Constant 2000 Monthly Prices($/metric ton) Forecast 2.00 Forecast 3200 Constant 2000 350 3 1.75 2700 250 1.50 2 Constant 2000 Current 2200 1.25 150 1 1700 Current 1.00 50 0 1980 1985 1990 1995 2000 2005 2010 2015 2020 0.75 1980 1985 1990 1995 2000 2005 2010 2015 2020 1200 Source: World Bank Source: World Jan-00 Bank Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan Source: World Bank Sou Cotton Aluminum Monthly Prices($/metric ton) Current Constant 2000 COCOA ICCO ($/kg) 2.00 2.75 3200 3000 Constant 2000 Forecast 1.75 2.25 2325 2700 1.50 1.75 2200 1650 1.25 Current 1.25 1700 975 1.00 0.75 Commodity Markets 0.75 1200 300 Global World Bank Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 1980 1990 Jan-00 1985 Jan-02 1995 2000 Jan-04 Jan-06 2010 Jan-08 2005 2015 2020 Jan-10 19 Source: World Bank Source:World Source: WorldBank Bank S Global Commodity Markets Review and price forecast A Companion to Global Economic Prospects 2010 Global Commodity Markets World Bank 4 Copyright 2010 The International Bank for Reconstruction and Development/The World Bank 1818 H Street N.W., Washington, D.C. 20433, USA Telephone: 202-473-1000 Internet: www.worldbank.org All rights reserved. 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Global Commodity Markets World Bank Table of Contents 5 Global Commodity Outlook ...................................................................................................... 6 Key Commodities Aluminium ................................................................................................................... 10 Cocoa ........................................................................................................................... 11 Coffee ........................................................................................................................... 12 Copper ......................................................................................................................... 13 Cotton .......................................................................................................................... 14 Gold ............................................................................................................................. 15 Maize ............................................................................................................................ 16 Nickel ......................................................................................................................... 17 Palm Oil ....................................................................................................................... 18 Petroleum .................................................................................................................... 19 Rice .............................................................................................................................. 20 Rubber ......................................................................................................................... 21 Soybeans ...................................................................................................................... 22 Sugar ............................................................................................................................ 23 Tea ............................................................................................................................... 24 Wheat ........................................................................................................................... 25 Appendices Appendix A: Prices and Forecasts Table A1: Commodity Price Data ............................................................................... 26 Table A2: Commodity Prices and Price Projections in Current Dollars ................... 28 Table A3: Commodity Prices and Price Projections in Constant 2000 Dollars ........ 29 Table A4: Weighted Indices of Commodity Prices and Inflation, 2000=100 ............ 30 Appendix B: Description of Price Series ........................................................................ 31 Appendix C: Definitions and Explanations ..................................................................... 33 Appendix D: Acronyms and Abbreviations .................................................................... 34 This report was prepared by Staff of the World Bank’s Development Prospects Group. The core team consisted of John Baffes, Shane Streifel, and Betty Dow. Henock Kebede provided desktop editing and Rachel Weaving provided editing services. Questions or comments should be e-mailed to gcm@worldbank.org or or visit us on the web at http://www.worldbank.org/prospects Global Commodity Markets World Bank 6 Global Commodity Outlook Most commodity prices reached historical highs in Prices of some agricultural commodities also start- mid-2008, giving rise to the longest and broadest ed to rebound in 2009:Q2, in response to demand commodity boom of the post-WWII period. Apart increases and, in some cases (for example, sugar from strong and sustained economic growth, the and rice), the effects of adverse weather. Dollar boom was fueled by numerous factors including price increases also reflected the depreciation of years of low prices and low investment; a weak the dollar against major currencies. Yet, expressed dollar; and investment fund activity. Rapid eco- in trade-weighted local currency indices, prices nomic growth caused global stocks of many com- rose by much less. modities to fall to levels not seen since the early 1970s, in turn accelerating the price increases that Energy peaked in 2008. Further exacerbating the demand World crude oil demand, which had grown by 1.7 and supply mismatch were the diversion of some percent a year on average during 2000–07, declined food commodities to the production of biofuels, by nearly 3 percent during 2008:Q4 and 2009:Q1— adverse weather conditions, and government poli- as a result of reduced economic activity and of in- cies such as export bans and prohibitive taxes. duced conservation and substitution toward other The financial crisis that erupted in September energy sources in response to the high oil prices. 2008 and the subsequent global economic down- Oil demand in OECD countries has been falling turn relieved most of the demand-side pressures since 2005:Q4 (when oil prices surged above $50 a and induced sharp price declines across most com- barrel), and little or no growth is expected in 2010. modity sectors. The largest declines occurred in Oil demand outside the OECD countries declined industrial commodities such as metals (which had in 2009:Q1 but has since risen and is projected to also registered the greatest gains in the early 2000s). resume its trend growth rate of nearly 4 percent in Between July 2008 and February 2009, prices of 2010. Overall, global demand growth should re- energy declined by two-thirds while those of met- main muted at 1.5 percent a year. als dropped by more than half. Prices of agricultur- OPEC responded to the fall in global demand by al goods retreated by more than 30 percent, with reducing its production by nearly 4 million barrels prices of edible oils dropping by 42 percent. The a day in an effort to maintain prices at around $75 troughs in energy and non-energy indices broadly a barrel. As a result, OPEC’s spare capacity has in- coincided with troughs in global economic activity creased to around 6.5 million barrels a day, roughly (particularly in China and East Asia). the same level as in 2003 when oil prices were $20 Prices of energy and metals commodities be- a barrel (figure 2). Moreover, inventories of crude gan to recover in March 2009 (figure 1), in part oil and oil products remain high with some 150 mil- responding to recovery in industrial production lion barrels currently being stored on ships at sea. and other factors including strong import demand Agriculture Agriculture While current crude oil supply is ample, longer- from China, large-scale production restraint in the term prospects are more clouded. Over recent de- extractive commodities, tight scrap markets, and cades non-OPEC supply has been fairly stagnant strike-related disruptions in the case of metals. (except from the former Soviet Union, whose out- Figure Commodity 1.1. Figure Price Commodity Indices Price (Nominal, Indices 2000=100) (Nominal, 2000=100) Figure 1. Commodity Price Indices (Nominal, 2000=100) Figure 2. OPEC Spare Capacity (mb/d) Figure OPEC 2.2. Figure Spare OPEC Capacity Spare (mb/d) Capacity (mb/d) 500 500 88 Energy Energy Agriculture Agriculture Metals Metalsand Minerals and Minerals 400 400 66 300 300 44 200 200 100 22 100 00 00 Jan-90 Jan-90 Jan-94 Jan-94 Jan-98 Jan-98 Jan-02 Jan-02 Jan-06 Jan-06 Jan-10 Jan-10 Jan-01Jan-02 Jan-01 Jan-03Jan-04 Jan-02Jan-03 Jan-04Jan-05 Jan-05Jan-06 Jan-06Jan-07 Jan-08Jan-09 Jan-07Jan-08 Jan-09Jan-10 Jan-10 Source: World Source: Bank World Bank Source: International Source: Energy International Agency Energy Agency Global Commodity Markets World Bank Figure Copper 4.4. Figure Prices Copper and Prices LME and Stocks LME Stocks Source: World Bank Source: International Energy Agency 7 Figure 4. Copper Prices and LME Stocks Figure 3. Energy Price Indices (2000=100) Figure 3. Energy Price Indices (2000=100) during 2009, mainly because of the strong increas- 400 in unconventional shale-gas production, where000 tons es $/ton 10000 1000 Current Dollars Constant 2000 Dollars reserves are enormous. Though energy prices are 300 expected 7500 to increase 22 percent in 2010 over 750 byaxis] Copper price [left 2009, over the long term they are expected to sta- 200 5000 at about twice the levels experienced in the 500 bilize early 2000s (figure 3). 100 2500 Stocks [right axis] 250 Forecast Metals 0 China 0 has been a primary driver of metals prices 0 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 Jan-03 Jan-04 Source: World Bank in the 2000s and Jan-05 has becomeJan-06 Jan-07 Jan-08 the world’s Jan-09 largest Jan-10 Source: LME and Datastreem consumer of metals as well as its largest steel pro- put rose strongly in the early 2000s), with increased ducer. Between 2000 and 2008, China’s consump- production in Brazil, Figure 5. Metals Canada, and Minerals and Price West Indices Africa off- (2000=100) tion of Figure 6. Precious key metals such Metals (US$, 2000=100) Price Indices copper, as aluminum, lead, set by declines in U.S. and North Sea output. Al- nickel, tin, and zinc grew on average by 16.1 per- though 400 much higher prices now have prompted 400 Current Dollars Constant 2000 Dollars cent a year. Outside China, metals Current Dollars demand rose by Constant 2000 Dollars increased investment, growth from new develop- less than 1 percent a year. ments 300 has been sluggish, partly because of high 300 The global recession prompted a sharp decline costs in 2007–08 caused by shortages of equip- 200 in demand 200 for metals. During the first half of 2009, ment and skilled labor, and because of numer- global consumption of aluminum and copper, the ous project delays. Moreover, some three-fourths Agriculture 100 most 100 important metals in terms of volume, fell by of known reserves are controlled by national oil Forecast oil 19 percent and 11 percent, respectively. Restock- Forecast companies, which forces major international 0 ing by 0 Chinese companies and the government’s companies to invest in higher-cost developments 1970 1980 1985 1990 19751. Commodity Figure Price1995 2000 Indices 2005 2010 (Nominal, 2015 2020 2000=100) State 1970 Reserves 1975 1980 Bureau 1985 1990resulted in strong 1995 2000 2005 2010 demand 2015 2020 such oil Bank asWorld Source: sands and deepwater fields. Source: Figure 2. World OPEC Bank growth in first Capacity the Spare half of (mb/d) the year, but during the Given the large inventory overhang, and the 500 second half the restocking waned, while a similar 8 modest Figure increases Energy 7. in Global Grains oilStocks-to-Use demand Agriculture expected Metals and Minerals over the Ratio Figure Food Price Indices 8. industrial 2000=100) (US$, had 400 restocking in countries yet to mate- next few years, real Grains oil prices are not expected Stocks 6 rialize. Despite rising inventories, prices continued 0.40 to300rise. However, the sector remains sensitive to 400 to climb late in 2009 Current a number due to Constant Dollars of labor dis- 2000 Dollars 0.35 demand and supply developments, and a sig- both 4 200 putes 300 in the Americas (figure 4). Global demand for nificant disruption to global supply could cause 0.30 aluminum 2 and copper in 2009 is estimated to have another 100 sharp, if temporary, rise in prices. Over 0.25 declined 200 by 11 percent and 9 percent respectively the0 longer term, unless significant additional re- 0.20 from 0 2007 peaks, with demand from outside China Jan-90 are Jan-94 serves discovered, Jan-98 OPEC’s Jan-02pricing power Jan-06 will Jan-10 Jan-01 Jan-02 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Source: World Bank down 100 by more than 20 percent for both metals. continue 0.15 to increase. Ultimately, supplies from al- Source: International Energy Agency On the supply side, cutbacks at mines and Forecast ternative energy sources such as coal, natural gas, 0.10 smelters were significant early in the downturn of 0 nuclear 1970 power, 1975 and1985 1980 various 1990 renewables 1995 2000 are 2005 likely2010 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 the cycle. In addition, project cancellations, tight limitUSthe to Source: rise ofin Department Agriculture real oil prices. Industry esti- World Source:4. Figure Bank Prices and LME Stocks Copper Figure 3. Energy Price Indices (2000=100) Figure 4. Copper Prices and LME Stocks mates suggest that at current real oil prices, de- Figure 9. Raw Materials Price Indices (US$, 2000=100) $/ton Figure 10. Fertilizer Price Indices (US$, 2000=100) 000 tons mand 400 and supply should remain in balance for the 10000 1000 foreseeable future. Current Dollars Constant 2000 Dollars 200 600 Coal and 300 natural Current Dollars gas Constantprices followed similar Current Dollars 7500 Copper price Current [left axis] Dollars Constant 2000 Dollars 750 patterns 150 to petroleum prices in 2008-09, declin- 450 ing200 substantially from their peaks and rebounding 5000 500 during 100 the latter part of 2009. Weak industrial and 300 100 2500 Stocks [right axis] 250 power demand during the recession led the slump Forecast in50prices, 0 while economic recovery and cold win- 0 150 0 weather ter 1970 1975 1980 have 1985given 1990 1995a recent 2000 2005 2010 to boost 2015 prices. Forecast2020 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-10 Jan-09 Forecast 0 Source: World Bank U.S. natural gas prices remained unusually low 0 LME and Datastreem Source: 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 Source: World Bank Source: World Bank Global Commodity Markets Figure 5. Metals and Minerals Price Indices (2000=100) World Bank Figure 6. Precious Metals Price Indices (US$, 2000=100) 400 400 Figure 1. Commodity Price Indices (Nominal, 2000=100) 0 0 0 F 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 Source: World Bank 500 Source: LME and Datastreem 8 8 400 Global Commodity Outlook Energy Agriculture Metals and Minerals 6 Figure Figure 5.5. Metals Metals and and Minerals Price Minerals Indices(2000=100) Price Indices (2000=100) climbed Figure on 6. Precious Metals renewed Price Indices weakness of the (US$, 2000=100) dollar and 300 surged to nominal highs during December 2009. 4 400 200400 Current Dollars Constant 2000 Dollars Precious metals climbed prices have Constant Current Dollars for eight con- 2000 Dollars secutive 100300 years, up 3.5 fold over the period. An im- 2 300 portant investment driver has been the growth in ure 0 physically backed exchange-traded funds (ETFs); 0 200 200 Jan-90 Jan-94 gold and silver Source: World Bank ETFJan-98 in 2009 Jan-06 inflows Jan-02 represented Jan-10 Jan-0 Sour 100 and 18 percent, respectively, of global mine 23 100 production. Precious metals prices are projected =100) Forecast Forecast 0 to remain 0 strong in 2010 but to decline over the Figure 2. OPEC Spare Capacity (mb/d) 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 forecast1970 period, 1975 1980 as 1985 high prices 1990 1995 discourage 2000 2005 2010 demand 2015 2020 8 Source: World Bank Figure Bank Price Indices (2000=100) 3. Energy Source: World and encourage new supply (figure 6). $/ton scrap markets, and numerous strikes (in Canada 400 10000 6 South7. and Figure Global Grains America, for Stocks-to-Use example) have Ratio helped tight- AgricultureFigure 8. Food Current Price Indices Dollars (US$, Constant 2000 2000=100) Dollars Grains Stocks en 4 markets. Over the next two years, metals prices Although 300 dollar agricultural prices have declined 7500 0.40 400 are expected to continue to rise moderately as the 22 percent since Dollars June their Current 2008 Constant 2000 Dollars they are peak, 0.35 200 almost twice as high as the lows they reached still global 2 recovery progresses and demand expands 300 5000 (figure 0.30 5). The rise is expected to be moderate part- in the early 2000s. The recent fall in agricultural 100 prices 2500 ly 00.25because of the large price appreciation to date, 200 reflects both lower oil prices—a key cost Jan-10 Jan-01mainly but because Jan-02 Jan-03 of the Jan-04 Jan-05 substantial Jan-06 Jan-07 Jan-08 idle capacity Jan-09 Jan-10 component—and larger stockpiles of key agri- Forecast 0.20 Source: International Energy Agency 0 0 in many sectors that can be profitably brought back cultural 100 commodities, including rice, maize, and 0.15 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 Ja into production at today’s prices. Once demand wheat (figure Source: World Bank 7), resulting from favorable harvests Forecast So growth 0.10 returns to trend and idle capacity is elimi- and area0 expansion. For example, the November Figure 1970 nated, the 1975 1980 Prices 4.industry Copper 1985 and will LMEbe 1990 again Stocks 1995 2000 challenged 2005to add 2010 2009 1970 1975 1980 1985 of US Department 1990Agriculture 1995 2000 2005 data 2010 2015 2020 indicate Source: US Department of Agriculture Source: World Figure Bank and Minerals Price Indices (2000=100) 5. Metals capacity in the face of strong demand growth in de- that stocks of key grains will increase 3 percent in $/ton 000 tons veloping countries—partly because new mines will 10000 Figure 9. Raw Materials Price Indices (US$, 2000=100) 1000 2009/10, 400 on 10. Figure top of thePrice Fertilizer 23 percent Indices (US$, gain they expe- 2000=100) 400 be more expensive (underground versus open pit, rienced in the previous Current Dollars season. Constant 2000 Dollars for200 example) 7500 and Copper often price in geopolitically difficult re- [left axis] 750 Barring 300 600 unforeseen production problems—such 300 gions. The Current Dollars will industry Constant alsoCurrent needDollars to contend with as the drought Current inDollars South AmericaConstant 2000 Dollars that affected soy- 450 declining 150 5000 ore grades, obligations for environmental 500 200 production or the drought in India that af- bean 200 and land rehabilitation, and pressures on water, en- fected sugar and rice production—agricultural 100 and labor supplies. Nonetheless, ergy, 2500 Stocks [right axis] metals prices 250 100300 markets are likely to remain well supplied. As a 100 st are not expected to regain the peaks attained ear- result, prices of food and raw material commodi- Forecast 50 lier 0 this decade. 0 ties0150 are projected to decline by 6 percent in 2010 0 2020 Jan-03 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 1 Precious Source: metals LME and Datastreem prices fell in the wake Forecast of the andSource: to remain World Bank relatively stable over the medium Forecast S 0 0 financial crisis and dollar appreciation. They then 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 term, 1970with up- and downside risks more or less 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 Source: World Bank Source: World Bank 100) Figure Figure 7. Global Grains Stocks-to-Use Ratio Figure 6.6. Precious Precious Metals Price Metals Price Indices Indices(US$, (US$,2000=100) 2000=100) Figure 7. Global Grains Stocks-to-Use Ratio Grains Stocks 0.40 400 400 Current Dollars Constant 2000 Dollars 0.35 300 300 0.30 0.25 200 200 0.20 100 100 0.15 st Forecast 0.10 0 0 1970 1975 1980 1985 1990 1995 2000 2005 2010 1 2020 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 Source: US Department of Agriculture S Source: World Bank Figure 9. Raw Materials Price Indices (US$, 2000=100) Commodity Global Figure Markets 8. Food Price Indices (US$, 2000=100) World Bank 200 600 400 Current Dollars Constant Current Dollars st Forecast Stocks [right Stocks axis]axis] [right 100 100 0 2500 2500 250 250 2020 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 Forecast Forecast 0 Source: World Bank 0 0 0 197019701975 1980 1975 1985 1980 1990 1985 1995 1990 2000 1995 2005 2000 2010 2005 2015 2010 2020 2015 2020 Jan-03 Jan-03 Jan-04 Jan-05 Jan-06 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-07 Jan-08 9 0 0 Jan-09 Jan-10 Jan-10 Source: World Source: Bank World Bank Source: and and LMELME Source: Datastreem Datastreem Figure 8. Food Figure Price 8. Food Indices Price (US$, (US$, Indices 2000=100) 2000=100) the export bans and other export restrictions that were introduced during the commodity price 400 Figure 5. Metals Figure and 5. Metals Minerals and Price Minerals Indices Price (2000=100) Indices (2000=100) spike Figure Figure of 6. Precious 2008.6. Precious Metals Moreover, MetalsPrice Indices Price Indices productivity (US$, 2000=100) (US$, gains 2000=100) at the Current Dollars Constant 2000 Dollars global level should ensure long-term food sup- 400 300 400 400 400 ply. However, there is a risk that several poor Current Dollars Current Dollars Constant 2000 Constant Dollars 2000 Dollars Current Dollars Current Dollars Constant 2000 Constant Dollars 2000 Dollars countries will come to rely increasingly on im- 300 200 300 300 300 ported food to meet basic needs unless they can improve their agricultural productivity growth. 200 100 200 200 200 Growth in per capita agricultural GDP between Forecast 0 100 100 1980 100 100 and 2004 varied across countries, exceeding 2010 1970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 3 percent a year in East Asia (the best-perform- Source: World Bank Forecast Forecast Forecast Forecast 0 0 ing0 region) 0 but falling short of 1 percent a year in 1970 balance 1970197519751980 (figures 1985 1980 19851990 8 1995 1990 and 2000 1995 9). 2000On 20052005 the 2010 2010one 2015 2020 2015hand, 2020 Sub-Saharan in 1970 19701975 1980 1975 1980 Africa. 198519851990 Most 1995 1990 1995 of 2000 this 2005 2000 2005variance 2010 2015 2010 2015 re- 2020 2020 00) Source:Figure World Source: 10. Bank World Fertilizer Price Indices (US$, 2000=100) Bank Source: World Source: Bank World Bank a stronger link between energy and agricultural flected productivity differences, in turn stemming prices 600 (higher costs of production plus demand from the full adoption of the green revolution in Figure 7. Figure for biofuel) Global 7. Global will Current Grains Grains exert Dollars Stocks-to-Use Stocks-to-Use upward RatioRatio on prices; Constant 2000 pressure Dollars Asia. Figure Figure8. Food 8. FoodPrice Indices Price (US$, Indices 2000=100) (US$, 2000=100) Grains Stocks Grains Stocks on450 the other hand, continued gains in total factor Agricultural production and prices will be af- 0.400.40 400 400 productivity (which tend to be stronger in agricul- fected by the prices Current Dollars Current of Constant Dollars fertilizer, 2000 Constant key input to aDollars Dollars 2000 0.350.35 ture 300 than in manufacturing) should constrain the the production of most crops. Fertilizer prices in- 300 300 costs 0.300.30 of production. Volatility in commodity prices, creased five-fold between 2002 and 2008. Though however, 150 0.250.25 could become a problem if financial in- they 200 200 declined considerably during 2009, their st vestors increase their influence in commodity Forecast mar- long-term real average is expected to be 80 per- 0.200.20 0 kets. Similarly, the use of food commodities for 100 100 higher than their early 2000s levels (figure cent 2020 0.150.151970 1975 1980 1985 1990 1995 2000 2005 2010 2015 2020 biofuel production, largely depending on national Source: World Bank 10), raising the cost of producing most agricultural Forecast Forecast biofuel 0.100.10 mandates, may influence prices as well. commodities. 0 0 Fertilizer prices are closely linked to 1970 Food 1970 1975 security 1975 19801980 1985 concerns 1985 1990 have 1990 19951995 2000 subsided, 2000 20052005 2010and 2010 energy 19701970 prices, 1975 1980 1975 providing 19801985198519901990another 199519952000 dimension 2005 2000 20052010 2015 2010 to 2015 the 2020 2020 Source: US Department Source: US Departmentof Agriculture of Agriculture Source: World Source: Bank World Bank countries have reduced or eliminated most of energy/non-energy price link. Figure 9. Raw Figure Materials 9. Raw Price Materials Indices Price (US$, Indices 2000=100) (US$, 2000=100) Figure 10.10. Figure Fertilizer Price Fertilizer Indices Price (US$, Indices 2000=100) (US$, 2000=100) Figure 9. Raw Materials Price Indices (US$, 2000=100) Figure 10. Fertilizer Price Indices (US$, 2000=100) 200 200 600 600 Current Dollars Constant Dollars Current Current Constant Dollars Current Dollars Current Dollars Current Dollars Constant 2000 Constant Dollars 2000 Dollars 150 150 450 450 100 100 300 300 50 50 150 150 Forecast Forecast Forecast Forecast 0 0 0 0 197019701975 1980 1975 1985 1980 1990 1985 1995 1990 2000 1995 2005 2000 2010 2005 2015 2010 2020 2015 2020 197019701975 1980 1975 1985 1980 1990 1985 1995 1990 2000 1995 2005 2000 2010 2005 2015 2010 2020 2015 2020 Source: World Source: Bank World Bank Source: World Source: Bank World Bank Key nominal commodity price indices (actual and forecast, 2000=100), 2004-11 Actual Forecast 2004 2005 2006 2007 2008 2009 2010 2011 Energy 136 188 221 245 342 214 261 265 Non-Energy 133 149 192 225 272 213 224 226 Agriculture 130 133 150 180 229 198 186 183 Food 136 134 147 185 247 205 193 193 Beverages 120 137 145 170 210 220 213 184 Raw Materials 120 131 160 175 196 169 156 158 Metals & Minerals 139 179 280 314 326 236 301 317 Fertilizers 137 163 169 240 567 293 239 205 Global Commodity Markets World Bank Forecast Constant 2000 Forecast 350 3 3 10 250 2 2 Aluminium Constant 2000 Aluminum prices averaged $1,665/ton in 2009, down 35 Global demand contracted in 2008 and 2009 but is Current 150 1 percent from $2,573/ton in 2008. Beginning in Q2, prices 1 expected to grow quite strongly in 2010 as global de- rebounded Current from their February lows, reflecting restock- mand recovers; aluminum has a broad range of end- 50 0 ing, strong import demand in China during the first half of uses0 in transport, construction, packaging, and electri- 1980 Jan-10 the year,1985 Jan-00 slowly 1990 Jan-02 Jan-04 2000 1995 improving demand 2005 Jan-06 2010Jan-08 elsewhere, 2015 and 2020 Jan-10 rising cal 1980 1985 and consumer 1990 1995 durables. 2000 More 2005 than2010 2015 half the 2020 global Source: World Bank Source: World Bank costs. A significant portion of LME inventories has been growth is expected to be in China, reflecting continued tied up in financing deals. High forward prices and cheap urbanization and industrialization and the fact that the 4 Cotton Aluminum Current Constant 2000 warehousing costs have made it profitable for investors to country has become the world’s largest automobile Monthly Prices($/metric ton) COCOA ICCO ($/kg) t 2.00 buy on spot Constant markets, hold stocks in storage,Forecast 2000 and sell on 3200 market. 3 forward 1.75 markets, locking in profits but effectively reduc- In the near term, prices will partly depend on the ing short-term supply. 2700 of reactivation of idle capacity, most of which lies pace 1.50 2In 2010-11, record inventories and substantial over- outside China. In the medium- to long term, the indus- capacity Current are expected to keep the aluminum market in 2200will face rising power prices from higher energy try 1.25 1 surplus, but over the medium term prices are expected costs, reduced subsidies, and deregulated markets. Fu- to rise moderately, pushed by strong end-use demand, 1700 supply growth is expected from regions that have ture 1.00 0 diminishing surpluses, and rising energy costs. Prices are low-cost power sources, for example Iceland, the Mid- 2020 0.75 1980 1985 1990 1995 2000 2005 2010 2015 2020 1200 East, Russia, and India (which also has abundant expected to continue Source: World Bank to lag those of other metals, notably dle Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 copper. Source: World Bank bauxite resources). Source: World Bank AluminumMonthly Prices ($/metric ton) Annual Prices ($/metric ton) Current Constant 2000 COCOA ICCO ($/kg) Current Constant 2000 2.75 3200 3000 Constant 2000 Forecast Constant 2000 2.25 2700 2325 1.75 2200 1650 Current 1.25 1700 975 Current Forecast 0.75 1200 300 Jan-10 Jan-00 1985 Jan-02 1980 1990 Jan-04 2000 1995 2005 Jan-06 2015 2010Jan-08 2020 Jan-10 1980 1985 1990 1995 2000 2005 2010 2015 2020 World Bank Source: World Source: Bank Source: World Bank Current Constant 2000 Global market data 3000 Constant 2000 2005 2006 2007 2008 2005 2006 2007 2008 t PRODUCTION (000 metric tons) EXPORTS (000 metric tons) 2325 China 7,806 9,358 12,559 13,177 Russian Fed. 2,740 3,164 3,949 4,818 Russian Fed. 3,647 3,718 3,955 4,187 Canada 2,240 2,360 2,501 2,532 Canada 1650 2,894 3,051 3,083 3,119 Australia 1,588 1,624 1,659 1,683 US 2,480 2,281 2,560 2,659 Norway 1,513 1,539 1,610 1,591 Australia 1,903 1,929 1,959 1,974 China 1,324 1,213 546 841 975 Brazil 1,498 1,605 1,655 1,661 Iceland 284 303 446 761 Norway Current 1,376 1,427 Forecast 1,357 1,359 Brazil 753 842 823 748 India 300 942 1,105 1,222 1,308 South Africa 671 601 625 598 South Africa 851 887 898 1,084 Netherlands 482 609 795 483 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 UAE Source: World Bank 850 789 890 892 Germany 392 432 423 435 World 31,995 33,969 38,087 39,425 World 17,023 17,706 18,906 19,308 CONSUMPTION (000 metric tons) IMPORTS (000 metric tons) China 7,119 8,648 12,347 12,413 Japan 2,977 3,036 2,986 3,064 US 6,114 6,150 5,580 5,615 US 3,691 3,461 2,951 2,932 Japan 2,276 2,323 2,197 2,250 Germany 1,770 2,073 2,231 2,063 Germany 1,758 1,823 2,008 1,950 Korea, Rep. 1,231 1,204 1,190 1,086 India 958 1,079 1,207 1,305 Italy 890 986 1,079 882 Russian Fed. 1,020 1,047 1,020 1,020 Turkey 383 414 572 598 Korea, Rep. 1,201 1,153 1,081 965 Belgium 763 738 754 558 Italy 977 1,021 1,087 951 Netherlands 656 971 1,043 554 Brazil 759 773 854 932 France 517 593 587 509 Canada 801 846 718 714 Taiwan, China 523 540 504 504 World 31,720 34,026 37,578 37,796 World 18,318 19,254 19,334 17,894 Source: World Metal Statistics Global Commodity Markets World Bank Cocoa 11 Cocoa prices averaged $2.89/kg in 2009, 12 percent Grindings are expected to reach 3.56 million tons in higher than in 2008. Reflecting persistent supply prob- 2009/10, marginally higher than last season’s. Among lems they reached an all-time nominal high during key processors, only Côte d’Ivoire increased its grind- 2009:Q4. Preliminary estimates for the 2009/10 (Octo- ings last season (from 374 to 420 thousand tons) in an ber to September) season show global output of 3.54 attempt to capture an increasing share of value-added million tons, up only slightly from the previous sea- activities in the production chain. Most other cocoa son’s 3.52 million tons. processors, including the Netherlands, US, Germany, Wheat Cocoa The key reason behind the lack of supply response Malaysia, and Brazil, saw moderate declines in their Monthly Prices($/metric ton) COCOA ICCO ($/kg) 450 seems to have been the deterioration of infrastructure 4 grindings. in Côte d’Ivoire, the world’s largest producer, where In the expected tight market for cocoa, prices are 350 it has become very expensive to transport inputs to 3 likely to stay high by historical standards, averaging farmers and cocoa beans to the port. Several reports $3.00/kg in 2010. A decline to $2.40/kg is expected 250 also indicate that other key cocoa suppliers includ- in2 2011, with a further decline over the longer term, ing Indonesia and Ecuador are encountering problems as supplies in other key producing countries catch up 150 from El Niño-related adverse weather patterns. Grind- 1 with Côte d’Ivoire’s reduced production and eventu- ings, a measure of cocoa demand, are projected to ex- ally offset the market shortfall. This forecast depends 50 ceed production for a fourth season in a row, keeping 0 heavily on political developments, as well as infra- Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 Jan-02 Jan-04 Jan-06 the stocks-to-use Source: World Bank ratio at historically low levels. structure investments, Source: World Bank in Côte d’Ivoire.Jan-08 Jan-10 Cocoa Monthly Prices ($/kg) Annual Prices ($/kg) COCOA ICCO ($/kg) Current Constant 2000 Current Constant 2000 450 4 4 Forecast Constant 2000 Forecast 350 3 3 250 2 2 Constant 2000 Current 150 1 1 Current 50 0 0 Jan-10 Jan-00 1980 1985 Jan-02 1990 Jan-04 2000 1995 Jan-06 2005 2010Jan-08 2015 Jan-10 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 Source: World Bank Source: World Bank 4 Cotton Aluminum Current Constant 2000 Global market data 2005/06 2006/07 Monthly Prices($/metric ton) 2007/08 2008/09 ICCO ($/kg) 2005/06 2006/07 2007/08 COCOA2004/05 2.00 Constant 2000 Forecast 3200 PRODUCTION (000 metric tons) EXPORTS (000 metric tons) 3 Côte d'Ivoire 1,408 1,229 1,382 1,222 Côte d'Ivoire 950 1,006 851 862 1.75 Ghana 741 615 729 662 2700 Ghana 548 570 620 562 Indonesia 560 545 485 475 Indonesia 361 493 416 356 1.50 2 Nigeria 210 215 220 240 Nigeria 186 190 186 212 Current Cameroon 171 169 185 210 2200 Cameroon 165 146 140 159 1.25 1 Brazil 162 126 171 157 Togo 53 73 78 111 Ecuador 118 124 111 112 1700 Ecuador 81 89 99 97 1.00 Togo 73 78 111 95 PNG 47 51 47 52 0 PNG 51 49 52 52 World 2,495 2,740 2,579 2,535 2020 0.75 1980 1985 1990 1995 2000 2005 2010 2015 2020 1200 Dominican Rep. 46 42 41 45 IMPORTS (000 metric tons) Source: World Bank Jan-00Colombia Jan-02 Jan-04 37 Jan-06 30Jan-08 38 Jan-1045 Netherlands Jan-02 Jan-00 Jan-04 608 Jan-06 549 Jan-08 639 653 Jan-10 Source: World Bank Peru 31 32 33 34 Source: World Bank Malaysia 233 300 337 346 Aluminum World 3,786 3,434 3,731 3,515 US 514 505 380 335 GRINDINGS (000 metric tons) COCOA ICCO ($/kg) Current Constant 2000 Germany Current 236 287 Constant 2000 347 333 2.75 3200 Netherlands 465 480 490 440 3000 Belgium 182 190 195 176 Côte d'Ivoire Constant 2000 336 360 Forecast374 420 Constant 2000 France 153 157 165 164 US 432 418 391 359 UK 129 139 129 128 2.25 2700 2325 Germany 307 357 385 342 Spain 72 76 83 98 Malaysia 265 302 331 278 Singapore 64 70 89 89 2200 Brazil 1.75 223 226 232 216 1650 Russian Fed. 68 70 64 67 France 155 162 160 157 Canada 65 77 48 64 Ghana Current 85 121 123 140 Turkey 57 56 64 64 1.25 1700 975 World 3,536 3,661 3,755 3,508 World 2,891 2,997 3,080 3,049 Current Forecast Note: Latest trade data available are for 2007/08. 0.75 1200 Source: International Cocoa Organization, LMC International and World Bank estimates. 300 Jan-10 Jan-00 1985 Jan-02 1980 Commodity Global 1990 Jan-04 2000 1995 Markets Jan-06 2005 2010Jan-08 2015 Jan-10 2020 1980 1985 1990 1995 2000 2005 2010 2020 2015 World Bank Source: World Source: World Bank Bank Source: World Bank Current Constant 2000 12 Coffee Coffee prices during 2009 averaged $3.17/kg (ara- Global coffee consumption reached 130 million bica) and $1.64/kg (robusta), 30 percent higher and bags during 2008, up from 128 million in 2007. Histori- 12 percent lower than their respective 2008 averag- cally, total coffee consumption has grown by about 2 es. While arabica prices were boosted by a weather- percent a year, closely in line with world population induced shortfall in Colombia, robusta prices were growth, and this trend is likely to continue. Moreover, pushed downward by the arrival on the market of the because coffee consumption varies little with respect new, larger, Vietnamese robusta crop. Recent prelimi- Co ee especially in high-income countries, the re- to income, nary estimates for the 2009/10 season by the Interna- cent global economic Arabicadownturn (¢/kg) had no discernable Robusta (¢/kg) 4 9000 tional Coffee Organization show a 3.7 percent decline impact on global demand. Reported reductions in cof- in global coffee production (from 128 to 124 million fee consumption in some Eastern European countries bags). Most of this decline will be in the arabica market had 3 a minimal effect on the market. 7000 Arabica (4.9 percent down) rather than the robusta market (1.6 The estimates of a reduced 2009/10 coffee crop do percent down). Brazil’s 2009/10 crop is expected to not 2 seem to have brought stocks in exporting coun- 5000 be 39 million bags, down from 46 million in 2008/09. tries alarmingly low. Thus, barring an unfavorable Colombia, whose 2008/09 production was its lowest 1 weather event, arabica prices are expected to average 3000 since 1973/74, is not expected to recover its normal $2.70/kg in 2010 with a further (albeit small) decline in Robusta production level soon (Colombia’s shortfall caused the 0 Robusta prices are expected to average $1.78/kg 2011. 1000 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan- divergence between arabica and robusta prices). 2010World in Source: with no appreciable Bank change in 2011. Sour Co ee Monthly Prices ($/kg) Copper Annual Constant 2000 Prices ($/kg) Arabica (¢/kg) Robusta (¢/kg) Current Copper LME Constant 2000 4 6.0 9000 9000 Arabica Forecast 3 4.5 7000 7000 Arabica 2 3.0 5000 5000 Robusta 1 1.5 3000 3000 Robusta 0 0.0 1000 1000 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 1980 1990 Jan-00 1985 Jan-02 1995 Jan-042000 2005 Jan-06 2015 2010 Jan-08 2020 Jan-10 19 Source: World Bank Source:World Source: WorldBank Bank So Global market data 9000Gold Current Constant 2000 Current Constant 2000 6.0 2005/06 2006/07 2007/08 2008/09 2005 2006 2007 Gold Price, US $ per troy ounce 2008 Arabica Forecast 1200 Forecast 300 PRODUCTION (000 bags) CONSUMPTION (000 bags) 4.5 Brazil 32,944 42,512 36,070 45,992 7000 US 20,998 20,667 21,033 21,652 250 Vietnam 13,542 19,340 16,467 18,500 Brazil 950 15,390 16,133 16,927 17,526 Indonesia 3.0 9,159 7,483 7,777 9,350 Germany 5000 8,665 9,151 8,627 9,554 Colombia 12,329 12,541 12,504 8,664 Japan 7,128 7,268 7,282 7,065 200 Robusta Mexico 4,225 4,200 4,150 4,650 700 Italy 5,552 5,593 5,821 5,937 Constant 2000 150 1.5 India 4,396 5,159 4,460 4,372 3000 France 4,787 5,278 5,628 5,155 Ethiopia 4,003 4,636 4,906 4,350 Russian, Fed. 450 3,212 3,263 4,055 3,716 Peru 2,489 4,319 3,063 3,872 Spain Current 3,007 3,017 3,198 3,485 100 0.0 1000 Guatemala 3,676 3,950 4,100 3,730 Indonesia 2,375 2,750 3,208 3,333 1980 Uganda 1985 1990 2000 2,700 19952,159 2005 2010 2020 3,250 2015 3,100 Canada 200 1980 1985 1990 1995 2,794 2000 3,0982005 2010 3,245 3,2142020 2015 50 Source: World Bank Source: World Bank Honduras 3,204 3,461 3,842 2,978 UK Jan-00 Jan-02 2,680 Jan-04 3,059 Jan-06 2,824 Jan-08 3,067 Jan-10 Jan- Côte d'Ivoire 1,962 2,847 2,150 2,500 Source: World Bank Mexico 1,556 1,794 2,050 2,200 Sour Gold Nicaragua 1,718 1,300 1,700 1,600 Algeria Maize 1,892 1,836 1,968 2,118 Costa Rica 1,778 1,580 1,791 Gold Price, US $ per troy ounce 1,580 Ethiopia 1,833 Current 1,833Constant 2000 Monthly Prices ($/ton) 1,833 1,833 1200 El Salvador 1,502 1,371 1,621 1,420 1000300 Ukraine 1,025 968 1,057 1,733 300 Tanzania 804 822 810 1,186 Korea,Constant Rep. 2000 1,394 1,437 1,425 1,665 PNG 1,268 807 968 1,028 250 Venezuela 1,412 1,472 1,534 1,599 250 950 800 Kenya 660 826 652 883 India 1,272 1,375 1,438 1,518 Venezuela 760 813 899 880 200 Colombia 1,272 1,337 1,360 1,400 200 700 World 110,181 129,139 118,949 128,073 600 Netherlands 1,927 2,129 2,292 1,324 Arabica 67,853 80,674 73,017 78,599 150 Sweden 1,170 1,315 1,244 1,272 150 450Robusta 42,328 48,465 45,932 49,474 World 400 119,714 123,329 127,977 130,004 Source: International Coffee Organizarion 100 100 Forecast Current 200 20050 50 Global Commodity Jan-00 Markets Jan-04 Jan-02 Jan-06 Jan-08 Jan-10 Jan-00 1985 Jan-02 1980 1990 Jan-042000 1995 2005 Jan-06 2010 Jan-08World 2020 2015 Bank Jan-10 19 Source: World Bank Source: World Bank So Copper 13 Copper prices averaged $5,150/ton 2009, down 26 per- World copper demand, which grew 2.6 percent in cent from $6,956/ton in 2008. Their steady rise in 2009 2000-07, fell in 2008 and 2009 despite strong growth in from the lows reached in December 2008 was driven China. Although China’s demand growth is expected mainly by strong import demand in China, but also to slow, global demand is expected to rise at around by an extremely tight scrap market (a reflection of the 6.5 percent in 2010 and 2011, pushed by economic severe global industrial downturn) and a number of recovery and restocking elsewhere. Demand will then labor-related supply shutdowns in the Americas. Cop- resume its trend growth of less than 5 percent, with Co ee Copper per suffered fewer production Arabica (¢/kg) cutbacks than did other Robusta (¢/kg) some potential losses to substitution because of much Copper LME 4 metals following the contraction in global demand. 9000 higher prices for copper than other metals, particu- Copper prices are expected to remain elevated larly aluminum. 3 2010 and 2011, with demand growing relatively in 7000 Copper mine capacity is set to grow moderately Arabica strongly amid longer-term supply concerns. In the me- in future but the industry faces a number of hurdles, 2 dium term, capacity expansion will bring prices down 5000 notably declining ore grades, rising costs, and energy somewhat, with the expected development of a few and water availability. Much of the growth is projected 1 large mines and several small-to-medium operations. 3000 to come from Latin America and Africa’s copper belt. Prices are expected to remain well above historical Robusta Production in the latter region poses challenges with 0 levels because the industry faces several challenges in 1000 respect to labor, power, and flooding, as well political Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 adding new Source: World Bank capacity. risks regarding Source: World Bank licensing and contracts. Copper Monthly Prices ($/metric ton) Annual Prices ($/metric ton) Copper LME Current Constant 2000 Current Constant 2000 6.0 9000 9000 Arabica Forecast Forecast 4.5 7000 7000 3.0 5000 5000 Robusta Constant 2000 1.5 3000 3000 Current 0.0 1000 1000 Jan-10 Jan-00 1985 Jan-02 1980 1990 Jan-042000 1995 Jan-06 2005 2010 Jan-08 2015 Jan-10 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 World Bank Source: World Source: Bank Source: World Bank Global market data 9000Gold Maize Current Constant 2000 2005 2006 Gold Price, US $ per troy ounce 2007 2008 Monthly2005 2006 Prices ($/ton) 2007 2008 1200PRODUCTION (000 metric tons) Forecast 300 EXPORTS (000 metric tons) 7000China 2,600 3,003 3,499 3,779 Chile 2,799 2,606 2,910 3,004 Chile 2,824 2,811 2,937 3,060 250 Zambia 423 476 491 585 950 Japan 1,395 1,532 1,577 1,540 Japan 248 320 428 423 5000 US 1,260 1,250 1,310 1,275 200 Peru 514 449 365 419 700 Russian, Fed. 968 959 923 926 Australia 315 287 295 357 Constant 2000 Germany 638 662 666 690 Kazakhstan 401 357 349 344 3000 150 India 518 627 719 669 Poland 290 288 240 297 450 Zambia Current 446 497 522 605 Canada 100 297 280 298 290 1000Korea, Rep. 527 575 585 573 Belgium 241 237 201 260 2020 1980 200 Poland 1985 1990 1995 2000 560 2005 557 2010 533 2015 2020 527 Russian, Fed. 50 301 262 275 207 Source: World Bank World Jan-00 Jan-02 Jan-04 16,610 17,980 Jan-06 17,343 Jan-08 18,475 Jan-10 World Jan-00 Jan-02 Jan-04 7,454 Jan-06 7,477 7,618 Jan-08 7,838 Jan-10 World Bank (000 metric tons) CONSUMPTION Source: IMPORTS Bank tons) (000 metric Source: World China 3,656 3,614 4,863 5,134 China 1,222 827 1,496 1,458 US Maize 2,257 2,096 2,140 1,933 Germany 625 881 844 833 Germany Prices ($/ton) Monthly1,115 Current 1,398 20001,392 Constant 1,398 US Current 977 Constant 2000 1,076 832 721 1000 300 300 Japan 1,229 1,282 1,252 1,184 Italy 652 774 746 617 Rep.2000 Constant Korea, 868 828 858 852 Taiwan, China 640 647 Forecast 585 615 250 250 800 Russian, Fed. 667 693 688 731 France 517 507 432 434 Italy 680 801 764 635 Korea,Constant Rep. 2000 428 380 420 406 200 200 Taiwan, China 638 643 603 582 Turkey 224 150 288 288 600 India 397 407 516 511 Thailand 235 268 245 265 150 150 France 472 460 337 379 Brazil 168 175 218 252 400 World 16,639 16,974 18,098 18,032 World 6,994 7,051 7,129 6,766 100Source: World Metal Statistics. 100 Forecast Current Current 20050 50 Jan-10 Global Jan-00 1980 Commodity Markets1995 1985 Jan-02 1990 Jan-042000 Jan-062005 2010 Jan-08 2015 Jan-10 2020 1980 1985 1990 1995 2000 2005 2010 World 2020 Bank 2015 Source: World Bank Source: World Bank Forecast 350 350 3 3 14 250 250 2 Cotton 2 Constant 2000 Cotton prices (Cotlook A index) averaged $1.38/kg In the 2009/10 (Aug-Jul) season, global cotton during 150 2009, 12 percent lower than in 2008, most- 150 1 production totaled 22.2 million tons, down 6 percent 1 ly because of weak demand. Price increases during from 2008/09. Current Early estimates for 2010/11, based on 50 were less pronounced for cotton than for other 2008 planting 50 0 intentions, point to a sharp rise in produc- 0 Jan-00 agricultural Jan-02 Jan-04 because commodities, Jan-06 of yield Jan-08 and Jan-10 out- tion. 1980Consumption Jan-00 1990 during 1985 Jan-02 1995 Jan-04 2000 2009/10 2010Jan-08 2005 totaled Jan-06 2015 2020 23.8 mil- Jan-10 19 Source: World Bank So put increases associated with the increased use of lionSource: tons,World Bank reducing the stock-to-use ratio to 45 per- biotech cotton varieties. cent from last season’s 53 percent but well above the 4 Cotton Current Constant 2000 450The world average cotton yield increased from 566 historical average of 40 Currentpercent. Constant 2000 kg/hectare in 1998/99, when these varieties were in- Forecast Given 2.00 the Constant expectedMonthly 2000 sharp Prices($/metric increase ton)in global pro- Forecast 3200 troduced 350 to the Southern Hemisphere, to 792 kg/ha duction, 3 the Cotlook A Index is expected to aver- 1.75 in 2007/08. By 2009/10, biotech varieties accounted age $1.37/kg during 2010, similar to the 2009 average 2700 250 53 percent of the global area allocated to cotton. for but much lower than the $1.57/kg average of 2008. 1.50 2 Constant 2000 Australia, South Africa, and the US have fully adopted Moderate price increases are expected in the medium Current 2200 the 150 technology. The other two key beneficiaries have term, 1.25 1 as demand picks up from its recent weakness. been China and India, which have 70 and 75 percent, However, if further expansion of biotech varieties 1700 Current 1.00 respectively, 50 of their cotton area planted to biotech takes 0 place in key cotton producers such as Brazil, varieties 1980 and 1985 together 1990 1995account 2000 2005 702010 for percent the 2015 of2020 Pakistan, 0.75 1980 and 1985 Turkey, 1990 prices 1995 2005 to are likely 2000 2010come 2015under 2020 1200 global biotech Source: World Bank cotton area. further Jan-00 downward Source: World Bank Jan-02 pressure. Jan-04 Jan-06 Jan-08 Jan-10 Jan- Source: World Bank Sour Cotton Monthly Prices ($/kg) Aluminum Annual Prices ($/kg) Monthly Prices($/metric ton) Current Constant 2000 COCOA ICCO ($/kg) 2.00 2.75 3200 3000 Constant 2000 Forecast 1.75 2.25 2700 2325 1.50 1.75 2200 1650 1.25 Current 1.25 1700 975 1.00 0.75 0.75 1200 300 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 1980 Jan-00 1990 1985 Jan-02 1995 Jan-04 2000 2005 Jan-06 2015 2010Jan-08 2020 Jan-10 19 Source: World Bank World Bank Source: World Source: Bank So Current Constant 2000 Global market data Current Constant 2000 2.75 3000 2007/08 2008/09 2009/10 2010/11 Constant 2000 2007/08 2008/09 2009/10 2010/11 Constant 2000 Forecast PRODUCTION (000 metric tons) EXPORTS (000 metric tons) 2.25 2325 China 8,078 8,025 6,750 7,748 US 2,973 2,555 2,286 2,319 India 5,355 4,930 5,185 5,260 Uzbekistan 887 550 788 822 US 1.75 4,182 2,838 2,721 2,994 Australia 1650 270 230 336 363 Pakistan 1,845 1,920 2,113 2,265 Brazil 486 480 349 351 Brazil Current 1,603 1,402 1,170 1,270 Burkina Faso 194 156 184 204 1.25 Uzbekistan 1,206 1,060 950 1,007 975 Turkmenistan 185 120 177 197 Turkey 675 450 380 447 Greece Current 234 161 175Forecast 183 Australia 0.75 126 315 375 396 Pakistan 300 62 62 130 130 Turkmenistan 280 297 252 266 Zimbabwe 91 81 86 94 1980 1985 1990 1995 2000 2005 2010 2015 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 Syria 250 220 200 211 World 8,358 6,176 7,025 6,823 Source: World Bank Source: World Bank Greece 285 240 200 200 IMPORTS (000 metric tons) Burkina Faso 150 182 188 207 China 2,511 1,500 1,756 1,751 Argentina 152 130 176 187 Bangladesh 600 551 767 806 Egypt 212 118 104 115 Turkey 700 470 713 615 World 26,280 23,698 22,165 24,005 Pakistan 786 450 546 514 STOCKS (000 metric tons) Indonesia 495 435 449 455 China 3,328 3,226 3,067 3,101 Thailand 420 410 377 366 India 1,541 2,223 1,788 1,744 Vietnam 240 239 317 335 US 2,155 1,654 1,074 1,030 Mexico 333 266 303 243 Pakistan 601 689 718 740 Korea, Rep. 212 190 206 191 Brazil 1,224 949 604 593 Russian Fed. 233 200 196 175 Uzbekistan 384 655 498 433 Taiwan, China 215 185 174 165 World 12,202 12,583 10,677 10,520 World 8,289 6,176 7,025 6,823 Source: International Cotton Advisory Committee Global Commodity Markets World Bank Arabica Forecast 3 4.5 7000 7000 Arabica Gold2 3.0 5000 15 5000 Gold prices averaged $973/toz in 2009, up 12 percent RobustaNovember 2009 the IMF sold 200 tons of In early 1 1.5 3000 3000 from $872/toz in 2008. Prices have climbed for eight gold to the Reserve Bank of India (and subsequently Robusta years and are up 3.6 fold since 2001. Al- consecutive 12 tons to Sri Lanka and Mauritius). The IMF is autho- 0 0.0 1000 1000 though prices slipped to $760/toz in November 2008 rized to sell a further 191.3 tons—either off-market or, Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 1985 Jan-02 1980 1990 1995Jan-042000 Jan-06 2010 Jan-08 2005 2015 Jan-10 2020 19 amid the Source: financial World Bank crisis and dollar appreciation, they if sold into Source: Source: World World Bank market, within the provisions of the the Bank So resumed their climb on renewed weakness of the third five-year Central Bank Gold Agreement which dollar and investor concerns Current about inflation, Constant 2000 surging began in September 2009 Gold and limits total Current Constantannual 2000 sales 6.0 9000 above $1,200/toz in December 2009. An important to 400 tons. Gold Price, US $ per troy ounce Arabica driver was the growth in physically backedForecast exchange- 1200 Gold is the one commodity of which essentially Forecast all 300 4.5 7000 traded funds (ETFs). In 2009, gold ETF holdings rose production ends up in above-ground inventory and 250 950 by 563 tons or 47 percent—equivalent to 23 percent of for which investor sentiment thus remains a key de- 3.0 5000 global gold mine production. terminant of prices. High prices will restrain physical 200 Robusta prices are expected to remain relatively 700 Near-term demand stimulate new supplies from mines and and 2000 Constant 1.5 3000 150 firm, given investor concerns about the dollar, infla- scrap. Mine supply is projected to rise modestly, as 450 tion, and macroeconomic-financial conditions. Over prices are expected Current to remain conducive to expand- 100 0.0 1000 the longer term, prices are expected to fall back to- ing capacity. Though producer hedging has fallen, 1980 1985 1990 1995 2000 2005 2010 2015 2020 1980 200 projects 1985 1990 1995 2000 2005 2010 2015 2020 50 ward World Bankas high prices discourage demand and $850/toz Source: new Source: World Bank require hedging for project finance, may Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan stimulate new supplies. thereby adding Source: World Bank to supply. Sou Gold Monthly Prices ($/troy ounce) Maize Annual Prices ($/troy ounce) Gold Price, US $ per troy ounce Monthly Prices ($/ton) Current Constant 2000 1200 1000 300 300 Constant 2000 250 250 950 800 200 200 700 600 150 150 450 400 100 100 Forecast Current 200 200 50 50 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 1985 Jan-02 1980 1990 Jan-04 1995 2000 Jan-06 2010 Jan-08 2005 2015 Jan-10 2020 19 Source: World Bank WorldBank Source:World Source: Bank So Current Constant 2000 Global market data Current Constant 2000 1000 300 2005 2006 2007 2008 2005 2006 2007 2008 Constant 2000 Forecast PRODUCTION (metric tons) CONSUMPTION 250 (metric tons) 800 US 256 252 239 229 India 695 633 684 578 Constant 2000 China 209 240 270 222 China 200 258 270 327 342 South Africa 600 297 275 255 220 Turkey 303 242 277 237 Australia 263 247 245 215 Italy 150 285 227 218 180 Peru 208 203 170 180 US 219 211 179 176 400 Russian Fed. 163 159 157 157 Japan 164 175 178 164 100 Canada 121 104 Forecast 96 102 Saudi Arabia & Yemen 125 90 100 87 Current GhanaCurrent 67 70 76 79 Korea, Rep. 83 82 86 78 200 50 Uzbekistan 84 77 73 73 Russian Fed. 61 65 79 76 1980 PNG 1985 1990 1995 2000 69 2005 54 2010 562015 2020 67 Egypt1980 1985 1990 1995 2000 71 2005 50 201057 2015 65 2020 Source: World Bank Source: World Bank Indonesia 139 80 105 63 Indonesia 87 65 63 61 Mexico 30 39 44 50 Switzerland 56 61 62 59 Brazil 38 43 50 49 Malaysia 74 58 61 57 Mali 44 50 40 41 UAE 55 47 49 46 Chile 40 42 42 39 Germany 50 49 49 46 Argentina 28 44 42 38 Pakistan 64 54 50 44 Philippines 38 36 39 37 Iran 41 36 41 41 Tanzania 48 41 40 37 Thailand 69 53 48 40 Colombia 36 16 15 34 Canada 27 22 22 40 Kazakhstan 18 21 21 21 Singapore 30 29 30 28 Guinea 14 11 13 20 Taiwan, China 32 31 30 28 Kyrgyzstan 16 9 9 17 Austria 9 6 7 26 World 2,434 2,316 2,281 2,161 World 3,291 2,936 3,076 2,850 Source: World Metal Statistics, Gold Field Mineral Services. Global Commodity Markets World Bank Arabica Forecast Forecast 7000 4.5 7000 16 5000 3.0 5000 Maize Maize Robustaprices averaged $166/ton in 2009, 26 percent Global maize production is expected to remain Constant 2000 3000 1.5 3000 down from 2008 but similar to their 2007 average. The virtually unchanged in 2009/10 at 790 million tons, sharp price decline reflected a reduction in biofuel de- according to Current the US Department of Agriculture (No- 1000 0.0 1000 mand and, to a lesser extent, weaker global demand vember 2009). Production shortfalls in China, the EU, Jan-10 Jan-00 1985 Jan-02 1980 1990 1995Jan-042000 Jan-06 2005 2010 Jan-08 2015 Jan-10 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 for feed Source: Source: World World grains, Bank Bank due to a contraction in livestock pro- and Mexico will be balanced by a significant produc- Source: World Bank duction. During 2009 maize prices were remarkably tion increase in the US. Global exports will increase by stable. more than three million tons, coming wholly from the 9000Gold Declining crude and overcapacity oil prices, Constant Current 2000 in Maize the US ethanol industry, have reduced the profitabil- Gold Price, US $ per troy ounce US. Global stocks are Monthly expected to decline to 132 mil- Prices ($/ton) 1200 Forecast 300 tons in 2009/10 from 145 million tons in 2008/09, ity of ethanol production, causing a number of plants lion 7000 to be closed or reduce their capacity. In the US, the slightly 250 reducing the stock-to-use ratio from 18 to 17 950 world’s largest maize-based ethanol producer, the En- percent. In line with higher energy prices and biofuel 5000 ergy Independence and Security Act of 2007 mandated mandates, 200 maize prices are expected to average $166/ 700 11 billion gallons of ethanol use in 2009, to increase ton during 2010, with only modest increases taking Constant 2000 3000 150 gradually 15 billion gallons—equivalent to about 5 place in the following few years. Real maize prices 450 percent of US crude oil consumption—by 2015. If this Current 100 expected to average about 40 percent higher than are 1000 standard is binding, a considerable amount of maize in the first half of the current decade, before ethanol 2020 200 1980 1985 1990 1995 2000 2005 2010 2015 2020 50 will be World Source: diverted Bank to ethanol production, keeping prices production had become a significant component of Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 elevated by Source: World Bank historical standards. maize use. Source: World Bank Maize Monthly Prices ($/metric ton) Annual Prices ($/metric ton) Monthly Prices ($/ton) Current Constant 2000 Current Constant 2000 300 1000 300 Constant 2000 Forecast 250 250 800 Constant 2000 200 200 600 150 150 400 100 100 Forecast Current Current 200 50 50 Jan-10 Jan-00 1985 Jan-02 1980 1990 Jan-04 1995 2000 Jan-06 2005 2010 Jan-08 2015 Jan-10 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 WorldBank Source:World Source: Bank Source: World Bank Current Constant 2000 Global market data 300 2006/07 2007/08 2008/09 2009/10 2006/07 2007/08 2008/09 2009/10 Forecast PRODUCTION (000 metric tons) 250 EXPORTS (000 metric tons) US 267,503 331,177 307,386 328,207 US 53,987 61,913 47,184 52,072 Constant 2000 China 151,600 152,300 165,900 155,000 Brazil 10,836 7,791 7,500 9,000 200 EU-27 53,829 47,555 62,701 56,126 Argentina 15,309 14,798 7,500 8,000 Brazil 51,000 58,600 51,000 51,000 Ukraine 1,027 2,074 5,497 5,000 150 Mexico 22,350 23,600 25,000 22,500 EU-27 664 591 1,750 1,500 India 15,100 18,960 18,480 18,500 South Africa 468 2,162 2,500 1,500 100 Argentina 22,500 22,000 12,600 14,000 World 93,960 98,609 80,843 83,957 SouthCurrent Africa 7,300 13,164 12,567 11,500 IMPORTS (000 metric tons) 50 Ukraine 6,400 7,400 11,400 10,500 Japan 16,713 16,614 16,533 16,300 2020 1980 Canada 1985 1990 1995 8,9902000 2005 11,649 10,5922015 9,560 2010 2020 Mexico 8,944 9,556 7,700 9,000 Source: World Bank Indonesia 7,850 8,500 8,700 9,000 Korea, Rep. 8,731 9,311 7,194 7,500 Nigeria 7,800 6,500 7,900 8,300 Taiwan, China 4,283 4,527 4,400 4,600 Philippines 6,231 7,277 6,846 6,850 Egypt 4,826 4,151 5,000 4,200 Serbia 6,415 4,054 5,900 6,400 Colombia 3,386 3,267 3,200 3,300 World 712,380 791,871 791,627 790,175 Iran, Islamic Rep. 3,300 2,900 3,600 2,900 STOCKS (000 metric tons) Malaysia 2,363 3,181 2,000 2,600 China 36,602 39,394 53,169 48,719 EU-27 7,056 14,016 2,500 2,500 US 33,114 41,255 42,523 42,547 Algeria 2,406 1,963 1,900 2,100 Brazil 3,592 12,579 12,579 9,579 Canada 2,102 3,182 1,843 2,000 South Africa 1,661 3,090 3,182 3,007 Syria 1,516 1,691 1,800 1,900 EU-27 7,382 4,362 5,813 2,939 Saudi Arabia 1,577 1,961 1,700 1,800 Mexico 3,084 4,131 3,831 2,581 Morocco 1,558 1,883 1,500 1,600 World 108,864 129,306 145,439 132,342 World 90,287 98,348 80,837 81,899 Source: US Department of Agriculture Global Commodity Markets World Bank Nickel 17 Nickel prices averaged $14,655/ton in 2009, down 31 World nickel demand has fallen for three consecu- percent from $21,111/ton in 2008. They rebounded tive years, after an extraordinary price peak of more strongly beginning in March, reflecting a surge in stain- than $50,000/ton provoked substitution to low-grade less steel production, massive cuts in nickel production nickel products. Stainless steel production is expected in the immediate wake of the financial crisis, relatively to rebound strongly in 2010, led by China, but also tight availability of scrap, and strikes at Vale’s Canadian increasingly in other major producing centers. Thus operations. Later in 2009, prices weakened as stainless nickel demand should increase by 10 percent in 2010, Nickel steel production outpaced demand, and LME nickel in- with growth slowing only slightly in 2011-12 before Monthly Prices ($/metric ton) ventories climbed to 15-year highs. In December 2009, 60000 returning to trend. 1400 prices were one third of their peak of May 2007, owing Despite robust consumption, projected nickel sup- to a surplus of some 20 percent of global capacity. 45000 appear more than adequate, in view of large idle plies 1100 Nickel prices are expected to rise only moderately capacity and a stream of new projects due to start pro- in 2010, because substantial idle capacity and new sup- 30000 duction this year and the next few years. Nickel price 800 ply additions are expected to comfortably satisfy rising gains may also be limited by a fall in costs of nickel demand. However, they are likely to remain volatile 15000 pig-iron production in China (from low-grade ores im- 500 due to the large stocking/destocking cycles that typi- ported from the Philippines, Indonesia, and New Cale- fy the stainless steel sector, which accounts for about 0 donia), to some $14,000-$15,000/ton, although these 200 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan two-thirds of nickel demand. costs are sensitive Source: World Bank to costs of coke and freight. Sou Nickel Monthly Prices ($/metric ton) Palmoil Annual Prices ($/metric ton) Monthly Prices ($/metric ton) Current Constant 2000 COCOA ICCO ($/kg) 60000 40000 1400 1000 Forecast 45000 30000 1100 800 30000 20000 800 600 Constant 2000 15000 10000 500 400 0 0 Current 200 200 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 1980 Jan-00 1985 Jan-021990 1995 Jan-042000 2005 Jan-06 2015 2010 Jan-08 2020 Jan-10 19 Source: World Bank Source: World Source: World Bank Bank So Current Constant 2000 Global market data Petroleum Current Constant 2000 40000 1000 2005 2006 2007 2008 2005 Monthly 2006 ton) 2007 Prices($/metric 2008 Forecast 140 Constant 2000 Forecast 950 PRODUCTION (000 metric tons) CONSUMPTION (000 metric tons) 30000 Russian Fed. 268 274 267 264 800 China 195 234 328 305 Canada 140 154 163 176 Japan 105 180 181 196 185 750 China 20000 95 132 220 171 US 600 135 144 118 121 JapanConstant 2000 164 152 161 156 Germany 116 106 110 90 Australia 122 116 114 108 70 Rep. Korea, 118 93 71 73 550 10000 Norway 85 82 88 89 400 China Taiwan, 84 107 76 69 Finland 39 47 55 51 Italy 60 68 64 68 35 350 Cuba Current 44 42 44 44 Belgium Current 49 58 55 47 0 200 Colombia 53 51 49 42 South Africa 47 54 44 44 UK1980 1985 1990 1995 2000 38 200537 2010 342015 2020 39 0 1980 Finland 1985 1990 1995 2000 49 2005 51 201040 2015 412020 150 NewSource: World Bank Caledonia 47 49 45 37 Spain Source: World Bank 48 53 41 41 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan South Africa 42 42 38 32 UKSource: World Bank 32 32 32 32 Sou Brazil Petroleum 30 31 32 31 Sweden Rice 35 36 34 31 Ukraine 13 16 21 25 France 32 32 31 28 Monthly Prices($/metric ton) Current Constant 2000 Monthly Prices ($/ton) Dominican Rep. 140 29 30 29 20 950 Fed. Russian 120 26 26 26 26 700 Indonesia 7 14 19 18 Brazil 26 25 22 Forecast 25 Greece 19 18 19 17 India 16 18 19 21 600 105 90 750 Macedonia 8 11 15 15 Canada 5 5 5 5 500 France 13 14 15 13 Singapore 4 4 4 4 Zimbabwe 70 16 13 14 11 Turkey 60 550 3 1 1 4 400 Venezuela 17 17 16 11 Austria Constant 2000 7 8 3 3 Poland 1 2 2 3 300 35 World 1,288 1,341 1,456 1,368 30 350 World 1,296 1,366 1,353 1,295 Source: World Metal Statistics 200 0 0 Current 150 100 Global Commodity Jan-00 Markets Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 1980 Jan-00 1985 Jan-021990 1995 Jan-042000 2005 Jan-06 World Bank 2010 Jan-08 2015 2020 Jan-10 19 Source: World Bank Source: World Bank So 18 Palm Oil Palm oil prices averaged $683/ton in 2009, 28 percent Oil World expects global palm oil output to reach lower than their $1,170/ton average of 2008. Prices of 47.2 million tons during the 2009/10 (Oct to Sep) sea- almost all edible oils rose dramatically during the first son, 6.5 percent higher than the year before. Palm oil half of 2008, to levels not seen since 1973. However, import demand is expected to rise by about 2 percent they declined sharply during the second half of 2008 to during 2009/10 (far less than last season’s 9 percent in- levels more in line with fundamentals. Though strong crease) because the two key importers, China and India, import demand—especially by China and India—and will experience limited consumption growth. The pro- Nickel Palmoil increased use of competing oils for biofuel use played Monthly Prices ($/metric ton) jected stock-to-use ratio during 2009/10, at 14 percent, COCOA ICCO ($/kg) 60000 key roles during the rally, the sharp downward correc- 1400 is about 2 percentage points below historical levels. tion during the first half of 2008 suggests the rally had Given the projected recovery of soybean produc- 45000 an element of overshooting. During 2009:Q4 prices 1100 tion from last year’s weather-induced shortfall, and picked up again in response to strong import demand, restraint in biofuel mandates in several countries, in- 30000 weak supplies of substitute oils (especially soybean 800 cluding in the EU (the world’s largest biodiesel pro- oil), and rising crude oil prices. Global production of ducer), palm oil prices are expected to average $660/ 15000 soybean oil is estimated at 37.6 million tons during 500 in 2010 and to be marginally higher in 2011. In real ton 2009/10, up from 36.0 million tons in 2008/09 but very terms, however, the 2010-12 average is expected to be 0 similar to the 2007/08 level. 200 thirds higher than in the early 2000s. two Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Source: World Bank Source: World Bank Palmoil Monthly Prices ($/ton) Annual Prices ($/ton) Current Constant 2000 COCOA ICCO ($/kg) Current Constant 2000 40000 1400 1000 Forecast Constant 2000 Forecast 30000 1100 800 20000800 600 Constant 2000 10000500 400 Current 0200 Current 200 Jan-10 Jan-00 1985 Jan-02 1980 1990 1995 2000 Jan-04 2005 2015 Jan-06 2010 Jan-08 2020 Jan-10 1980 1985 1990 1995 2000 2005 2010 2015 2020 Source: Source:World WorldBank Bank Source: World Bank Petroleum 1000 Current Constant 2000 Rice Global market data 2006/07 Monthly 2007/08ton) 2008/09 Prices($/metric 2009/10 2007/08 2006/07Prices Monthly ($/ton) 2008/09 2009/10 t 140 Forecast 950 PRODUCTION Constant 2000 (000 metric tons) EXPORTS (000 metric tons) 800 Indonesia 16,730 18,880 20,450 22,090 Indonesia 12,465 14,100 16,110 16,840 105 Malaysia 15,294 17,567 17,259 18,200 750 Malaysia 13,768 15,041 15,990 16,180 Thailand 600 989 1,273 1,310 1,420 PNG 406 385 451 422 Nigeria 752 812 853 880 Ecuador 180 178 173 189 70 550 Colombia 830 779 758 773 Thailand 327 399 123 160 400 Ecuador 409 417 431 466 World 29,638 32,850 35,480 36,350 35 World 37,591 42,666 44,262 47,154 IMPORTS 350 (000 metric tons) CONSUMPTION Current (000 metric tons) China 5,543 5,559 6,297 6,200 200 India 3,698 4,882 6,565 6,800 India 3,664 5,019 6,875 6,550 2020 1980 0 China 1985 1990 1995 2000 2005 2010 2015 2020 150 5,461 5,660 5,917 6,348 EU-27 4,634 5,012 5,790 6,150 Source: World Bank Jan-00 EU-27 Jan-02 Jan-044,478 Jan-06 4,806 Jan-08 5,592 Jan-10 6,000 Jan-00 Pakistan Jan-02 Jan-04 1,743 Jan-06 1,769 Jan-08 1,800 Jan-10 1,840 Source: World Bank Indonesia 3,920 4,362 4,846 5,230 Source: US World Bank 692 955 1,036 985 Rice Malaysia 2,132 2,449 2,474 2,540 Bangladesh 871 855 832 850 Pakistan 1,638 Prices ($/ton) Current Monthly 1,734 1,792 Constant 2000 1,800 Egypt 716 Current 508 770 Constant 2000 660 120950 700 Nigeria 1,042 1,219 1,265 1,301 Iran, Islamic Rep. 419 589 571 610 Thailand 700 941 Forecast 1,161 1,280 Japan 516 551 Forecast 550 531 600 90750 US 635 935 917 936 World 29,366 32,730 35,773 36,280 Colombia 467 457 580 748 500 STOCKS (000 metric tons) Egypt 598 486 550 569 IndonesiaConstant 2000 1,780 2,230 1,760 1,820 60550 400 Japan 509 550 536 545 Malaysia 1,461 1,951 1,579 1,750 Constant 2000 Russian Fed. 527 690 485 520 India 300 350 540 920 740 Turkey 30350 401 443 388 440 China 472 370 750 600 World 37,256 41,325 44,700 47,260 World 200 5,812 7,060 6,876 6,700 Source: Oil World, Hamburg, Germany and US Department of Agriculture Current 0150 Current 100 Jan-10 Global 1980 Commodity Jan-00 Markets1995 1985 Jan-02 1990 2000 Jan-04 Jan-06 2010 Jan-08 2005 2015 2020 Jan-10 1980 1985 1990 1995 2000 2005 2010 World 2015 Bank 2020 Source:World Source: WorldBank Bank Source: World Bank Forecast 45000 1100 30000 800 Petroleum 30000 800 20000 19 600 Constant 2000 Crude oil prices averaged $61.8/bbl in 2009, down World oil demand fell slightly in 2008—the first 15000 36.4 percent from 2008. Prices reached a low of $42/ 500 10000 decline in 25 years—and by 1.3 mb/d in 2009, with 400 bbl in February 2009, but recovered to near $75/bbl in OECD demand down by 2 mb/d or more than 4 per- 0 200 Current 0 Demand 200 December. They were influenced by OPEC’s removal cent. grew very strongly in China following a Jan-00 Jan-02 Jan-04 ofSource: 4 mb/d from World Bank the market in Jan-06 an effort to Jan-08 Jan-10 keep prices slumpJan-00 1980 in Source: 1985 Jan-02 2009:Q1, Source: World World Bank Bank 1990 and Jan-04 2000 Jan-06 1995 modestly in 2005 2010Jan-08 all other 2015 non-OECD Jan-10 2020 19 Sou up, but by the second half of 2009 compliance with regions except for the FSU, where it fell sharply. De- the agreed 4.2 mb/d production Current cuts had Constant 2000fallen to 60 mand is projected to rise by 1.4 mb/d Current in 2010, Constant 2000 with all 40000 1000 Petroleum R percent. US crude oil stocks fell in the second half of of the net growth outside OECD countries. Future oil Monthly Prices($/metric ton) Forecast 2009 on lower imports, but a large overhang of distil- 140 demand growth Constant expected to be moderate,Forecast is2000 tempered 950 30000 800 late remains. Some 145 million barrels of oil are stored by environmental concerns and efficiency gains. at sea, including 45 million barrels of crude and the 105 Non-OPEC supplies are expected to edge higher in 750 20000 600 remainder Constant mainly 2000 distillate. the medium term, as high prices support the develop- Real prices of crude oil are projected to average 70 of higher-cost deepwater and non-conventional ment 550 10000 400 $75/bbl (in 2009 dollars) over the forecast period, with resources. Much of the growth is expected to continue nominal prices rising from $62/bbl in 2009 to $80/bbl in to 35 come from Brazil, Canada, the Caspian, Russia, and Current 350 0 Current 200 2020. The forecast reflects the level of prices required West Africa. OPEC producers are all expected to add 1980 1985 1990 1995 2000 2005 2010 2015 2020 0 1980 1985 1990 1995 2000 2005 2010 2015 2020 150 to develop Source: Worldhigh-cost Bank oil sands in Canada, and assumes new capacity, Source: despite a current surplus of 6.5 mb/d, World Bank Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan- continued production restraint by major oil producers. with much of Source: World Bank the incremental output destined for Asia. Sour Petroleum Monthly Prices ($/barrel) Rice Annual Prices ($/barrel) Monthly Prices($/metric ton) Monthly Prices ($/ton) Current Constant 2000 140 950 120 700 Forecast 600 105 750 90 500 70 550 60 400 Constant 2000 300 35 350 30 200 0 0 Current 150 100 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 1980 1985 Jan-02 1990 Jan-04 2000 1995 Jan-06 2005 2010Jan-08 2015 Jan-10 2020 19 Source: World Bank Source:World Source: WorldBank Bank So Current Constant 2000 data Global market 700 Current Constant 2000 120 2006 2007 2008 2009 2006 2007 2008 2009 Forecast Forecast PRODUCTION (000 b/d) 600 CONSUMPTION (000 b/d) 90 Russian Fed. 9,843 10,078 10,005 10,197 US 20,687 20,680 19,419 18,642 500 Saudi Arabia 10,476 9,988 10,406 9,322 China 7,382 7,742 7,999 8,576 Constant 2000 US 60 7,375 7,482 7,523 8,064 Japan 400 5,213 5,039 4,845 4,409 Islamic Rep. Iran, Constant 2000 4,302 4,403 4,344 4,337 India 2,580 2,748 2,882 3,038 China 3,674 3,729 3,793 3,821 300 Russian Fed. 2,709 2,706 2,797 2,604 30 Canada 3,192 3,315 3,224 3,103 Germany 2,624 2,393 2,505 2,397 Mexico 3,682 3,477 3,164 2,968 200 Brazil 2,102 2,274 2,397 2,436 Current UAE Current 3,147 3,055 3,113 2,822 Canada 2,246 2,323 2,295 2,212 0 100 Brazil 2,114 2,221 2,371 2,499 Korea, Rep. 2,317 2,389 2,291 2,333 1980 Iraq 1985 1990 1995 1,922 2005 2000 2,113 2010 2,4092015 2,477 2020 Saudi Arabia 1985 1980 1990 1995 1,841 2000 2005 2,054 2,224 2015 2,398 2010 2020 Source: World Bank Source: World Bank Norway 2,778 2,556 2,461 2,383 Mexico 1,970 2,027 2,039 1,982 Venezuela 2,835 2,614 2,582 2,374 France 1,956 1,921 1,930 1,841 Kuwait 2,335 2,293 2,476 2,196 Iran, Islamic Rep. 1,693 1,693 1,730 1,628 Nigeria 2,408 2,294 2,106 2,097 UK 1,785 1,714 1,704 1,639 Algeria 2,021 2,030 2,058 1,938 Italy 1,813 1,759 1,691 1,603 Angola 1,410 1,708 1,893 1,817 Spain 1,602 1,617 1,574 n/a Libya 1,838 1,853 1,866 1,687 Indonesia 1,173 1,201 1,217 n/a Kazakhstan 1,361 1,418 1,442 1,574 Taiwan, China 1,097 1,123 1,074 n/a Qatar 1,294 1,322 1,457 1,489 Netherlands 1,043 962 982 n/a UK 1,662 1,663 1,564 1,457 Singapore 853 916 958 n/a World 85,532 85,607 86,470 84,878 World 83,797 84,878 84,455 83,117 OPEC 35,105 34,736 35,787 33,566 OECD 49,274 48,830 47,303 45,221 Non-OPEC 50,428 50,871 50,683 51,312 Non-OECD 34,523 36,048 37,153 37,896 Source: International Energy Agency (production), and BP Statistical Review of World Energy (consumption), World Bank (est 2009 consumption). Global Commodity Markets World Bank Forecast Constant 2000 Forecast 1100 30000 800 20 800 20000 600 Rice Constant 2000 Rice prices averaged $555/ton during 2009—16 per- Because of export restrictions motivated by food 500 10000 cent lower than the 2008 average ($650/ton) though 400 security concerns, global rice exports declined 9 per- more than three times higher than in 2000/01. The cent in 2008/09. Current Because of improved supply condi- 0 Current 200 global rice market is very thin, with only 7 percent 200 tions and relatively stable prices, most countries have Jan-10 Jan-00 1985 Jan-02 Jan-042000 Jan-06 2010 Jan-08 of 1980 global Source: World Source: production Bank World Bank 1990 1995 2005 traded internationally, 2015 aJan-10 and 2020 key 1980 either 1985 eliminated Source: World Bank 1990 or 1995 2000 moderated such 2010 2005 trade2015 2020 interven- factor behind the price spike of 2008 was the policy tions. But the rice export restrictions are likely to have measures with which key Currentrice suppliers and importers Constant 2000 a lasting impact because they have shaken confidence 1000Petroleum Rice sought to promote food security. Monthly Prices($/metric ton) in the world market, Monthly encouraging Prices ($/ton) countries to build 140 As of November Forecast 950 Constant 2000 2009, the US Department of Agri- larger inventories than usual for national food security 800 culture projected global rice production for 2009/10 at reasons. 105 433.9 million tons, reflecting weather-related production 750Despite the weather-related production shortfall 600 shortfalls in India and the Philippines. Plans announced this season, the global rice market appears well sup- 70 the Philippines, following the harvest shortfall, to by 550 plied. End-of-season stocks of the past and the current 400 buy an estimated 1.6 million tons of Thai rice, triggered season averaged 90.5 million tons, 17 percent higher 35 discussions of a repeat 350 in 2003-07. Thus rice prices are projected to fall to than Current of the April/May 2008 rally when 200 rice prices exceeded $900/ton. However, the market $460/ton during 2010 and a little higher during 2011. 2020 0 1980 1985 1990 1995 2000 2005 2010 2015 2020 150 responded Bank only moderate price increases—from Source: World with Even so, at that level real prices will average 70 per- Jan-00 Jan-02 Jan-04 Jan-06 $543/ton in Source: World Bank November and $591/ton in Jan-08 December. Jan-10 Jan-00 cent higher Jan-02 in 2010-12 Source: World Bank Jan-04 than in Jan-06 2000-07. Jan-08 Jan-10 Rice Monthly Prices ($/ton) Annual Prices ($/ton) Monthly Prices ($/ton) Current Constant 2000 Current Constant 2000 950 120 700 Forecast Forecast 600 750 90 500 Constant 2000 550 60 400 Constant 2000 300 350 30 200 Current 0 Current 150 100 Jan-10 Jan-00 1985 Jan-02 1980 1990 Jan-042000 1995 Jan-06 2005 2010 Jan-08 2015 Jan-10 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 Source: World Bank Source: World Bank Current Constant 2000 Global market data 700 2006/07 2007/08 2008/09 2009/10 2006/07 2007/08 2008/09 2009/10 600 Forecast PRODUCTION (000 metric tons) EXPORTS (000 metric tons) China 500 127,200 130,224 135,100 134,400 Thailand 9,557 10,011 9,000 8,500 India Constant 2000 93,350 96,690 98,900 99,500 Vietnam 4,522 4,649 5,200 5,000 Indonesia 400 35,300 37,000 37,300 37,600 India 5,740 4,654 2,500 4,000 Bangladesh 29,000 28,800 31,000 31,000 Pakistan 2,839 3,000 4,000 3,300 300 Vietnam 22,922 24,375 23,693 23,760 US 2,923 3,370 2,974 3,102 Thailand 18,250 19,300 19,400 20,000 China 1,340 969 1,300 1,300 200 Myanmar Current 10,600 10,730 10,150 10,730 Egypt 1,203 750 300 900 Philippines 100 9,775 10,479 10,593 10,710 World 31,459 31,120 28,672 29,694 Brazil 7,695 8,199 8,500 8,500 IMPORTS (000 metric tons) 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 Japan Source: World Bank 7,786 7,930 8,029 7,710 Philippines 1,800 2,700 2,000 1,750 US 6,267 6,344 6,515 7,163 Iran, Islamic Rep. 1,500 1,500 1,700 1,700 Pakistan 5,450 5,700 6,300 6,200 Nigeria 1,500 1,800 1,400 1,600 World 420,668 433,817 443,650 448,143 Saudi Arabia 958 961 1,360 1,370 STOCKS (000 metric tons) EU-27 1,338 1,566 1,050 1,300 China 35,915 38,015 42,845 44,445 Iraq 613 975 1,000 1,000 India 11,430 13,000 17,000 19,500 Malaysia 886 799 1,020 830 Indonesia 4,607 5,607 6,307 6,807 Côte d'Ivoire 920 845 800 800 Thailand 2,510 2,207 3,115 4,223 South Africa 795 1,025 580 750 Philippines 4,868 4,548 3,991 3,002 Japan 675 597 700 700 Japan 2,406 2,556 2,715 2,725 Senegal 675 820 740 700 Vietnam 1,392 2,018 1,761 1,771 Mexico 594 583 630 675 US 1,266 942 741 1,253 US 653 759 572 667 World 75,103 80,637 89,798 94,729 World 28,173 29,311 26,256 26,272 Source: US Department of Agriculture Global Commodity Markets World Bank Rubber 21 Natural rubber prices averaged $1.92/kg during 2009, World consumption of synthetic rubber declined by 26 percent lower than in 2008 but almost three times 11.5 percent in the first nine months of 2009, largely higher than in the early 2000s. Prices declined initially reflecting the reduction in global demand. Production in 2009, but rebounded toward the end of that year, of synthetic rubber totaled 12.8 million tons in 2008, reflecting the effects of fluctuating crude oil prices on down 5 percent from 2007, while estimates for the first the cost of producing synthetic rubber. Natural rubber nine months of 2009 show a further 10.5 percent de- consumption totaled 9.6 million tons in 2008, down cline. Rubber So from 9.9 million tons the year before. Estimates for the Prices of natural rubber are expected to average Monthly Prices($/metric ton) first nine months of 2009 indicate an unprecedented 4 $1.60/kg in 2010 and to increase to $1.70/kg in 2011 650 9.3 percent reduction in demand. A key reason was as demand picks up. This is in line with the projected the collapse in demand for tire production, associated 3 crude oil price of $75/barrel in 2010 and $76/barrel in 525 with the collapse of automobile sales, especially in 2011 as well as a reversal of the economic downturn in high-income countries. Global consumption of natu- 2 2010. If crude oil prices rise more than projected or the 400 ral rubber is dominated by China, which accounts for economic recovery is quicker than now anticipated, more than 30 percent. More than two thirds of natural 1 natural rubber prices may rise more sharply. Because 275 rubber production comes from the traditional suppli- the majority of rubber output goes for tire manufac- ers Thailand, Indonesia, and Malaysia, but Vietnam is 0 turing, rubber prices are closely linked to global eco- 150 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 emerging as an important player. nomic conditions. Source: World Bank Source: Rubber Monthly Prices ($/kg) Soybeans Annual Prices ($/kg) Monthly Prices($/metric ton) Current Constant 2000 Monthly Prices ($/ton) 4 3.0650 600 Forecast 2.5 3 525 475 2.0 2 400 Constant 2000 350 1.5 1 275 225 1.0 Current 0 0.5150 100 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 1980 1990 Jan-00 1985 Jan-02 1995 2000 Jan-04 Jan-06 2010 Jan-08 2005 2015 2020 Jan-10 1980 Source: World Bank Source: Source:World WorldBank Bank Sourc 3.0 Current Constant 2000 Global market600Sugar data Current Constant 2000 NATURAL RUBBER SYNTHETIC RUBBER Monthly Prices($/metric ton) 2005 2006 Forecast 2008 2007 60 2005 2006 Forecast 2008 2007 325 2.5 PRODUCTION (000 metric tons) 475 PRODUCTION (000 metric tons) Thailand 2.0 2,937 3,137 3,056 3,090 China 45 Constant 2000 1,632 1,813 2,215 2,325 275 Indonesia Constant 2000 2,271 2,637 2,755 2,751 US 2,366 2,606 2,697 2,314 350 Malaysia 1,126 1,284 1,200 1,072 Japan 1,627 1,607 1,655 1,651 1.5 India 772 853 811 881 30 Russian Fed. 1,146 1,219 1,210 1,139 225 Vietnam 469 554 602 663 Korea, 225 Rep. 770 848 1,010 970 1.0 China 510 533 590 560 Germany 855 865 803 742 15 Current 175 d'Ivoire Côte Current 165 178 183 195 France 655 664 655 645 0.5 100 World 8,904 9,791 9,796 10,026 World 12,136 12,690 13,430 12,789 1980 CONSUMPTION 1985 (000 metric 1995 1990 tons) 2000 2005 2010 2015 2020 0 1980 CONSUMPTION 1985 1995 1990 tons) (000 metric 2000 2005 2010 2015 2020 125 Source: World Bank China 2,266 2,780 2,892 2,934 Source: World Bank China Jan-00 Jan-02 Jan-04 2,467 Jan-06 3,064 Jan-08 587 3,479 Jan-10 Jan US 1,159 1,003 1,018 1,041 US World Bank Source: 2,002 2,001 1,929 1,734 Sou India Sugar 789 815 851 881 Japan Tea 1,156 1,171 1,162 1,138 Japan 857 874 887 878 Germany 635 635 599 530 Monthly Prices($/metric ton) COCOA ICCO Constant Current ($/kg) 2000 60Malaysia 387 383 450 469 Brazil 100 325 405 425 477 533 400 Thailand 335 321 374 398 Russian Fed. 568 572 597 Forecast 500 World 9,069 9,329 9,884 9,550 World 11,880 12,692 13,278 12,568 45 75 275 325 EXPORTS (000 metric tons) GROSS EXPORTS (000 metric tons) Thailand 2,633 2,772 2,704 2,561 US Constant 2000 1,105 1,250 1,316 1,157 30Indonesia 2,025 2,287 2,407 2,408 Korea 50 225Rep. 556 620 797 782 250 Malaysia 1,128 1,131 1,018 916 Germany 747 749 775 726 Vietnam 538 678 682 619 Russian Fed. 637 708 673 699 15World 6,502 6,830 7,229 7,016 25 175 World 7,243 7,609 7,626 7,239 175 Source: International Rubber Study Group 0 0 125 Current 100 Jan-00 Global Jan-02 Markets Jan-04 Commodity Jan-06 Jan-08 Jan-10 1980 Jan-00 1985 2000 1990 Jan-02 1995 Jan-04 2005 2010 Jan-06 2015 Jan-08 2020 World Jan-10 Bank 19 Source: World Bank Source: World Source: BankBank World So Current Constant 2000 Current Constant 2000 22 Soybeans Soybean prices in 2009 averaged $437/ton, 16 percent Part of the soybean price increase was fueled by down from 2008. The 2008 price peak was a response the use of competing vegetable oils in biodiesel pro- to strong demand for competing crops that are used duction, which accounts for an estimated 9 percent as biofuel feedstock (mainly maize for ethanol in the of global vegetable oil use. Yet biodiesel production US and rapeseed for biodiesel in the EU) and a poor from vegetable oils has proven to be unprofitable even soybean crop in South America’s key suppliers. The with oil prices at the $75 level. As a result, the share global soybean balance has now improved consider- of vegetable oil used for biofuel production stagnated Rubber Soybeans ably. According to the US Department of Agriculture in 2009 and future growth prospects for biodiesel pro- Monthly Prices($/metric ton) Monthly Prices ($/ton) 4 (November 2009), production in 2009/10 is projected 650 duction are limited. Consequently, soybean prices are to exceed 250 million tons, almost 20 percent higher expected to average $410/ton in 2010, followed by a 3 than last season. Production increases are projected 525 further decline in 2010 to $385/ton. These forecasts are for all three key suppliers: the US (up 12 percent), subject to both downside and upside risks, linked to 2 Brazil (up 11 percent), and Argentina (up 66 percent). 400 possibility that biodiesel mandates in various coun- the The better supply prospects will not only satisfy rising tries may be eased (which would reduce the demand 1 import demand but also raise stocks by an impressive 275 competing edible oils) and to the possibility of fur- for 35 percent, restoring the stock-to-use ratio to historical ther increases in energy prices (making the biodiesel 0 levels. 150 industry profitable). Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Source: World Bank Source: World Bank Soybeans Monthly Prices ($/metric ton) Annual Prices ($/metric ton) Monthly Prices ($/ton) Current Constant 2000 Current Constant 2000 650 3.0 600 Forecast Forecast 2.5 525 475 2.0 Constant 2000 400 Constant 2000 350 1.5 275 225 1.0 Current Current 150 0.5 100 Jan-10 Jan-00 1985 Jan-02 1980 1990 Jan-042000 1995 Jan-06 2005 2010 Jan-08 2015 Jan-10 2020 1980 1985 1990 1995 2000 2005 2010 2015 2020 Source: World Bank Source: World Bank Current Constant 2000 600Sugar Global market dataTea 2007/08 ton) 2008/09 2006/07Prices($/metric Monthly 2009/10 2006/07 2007/08 COCOA ICCO ($/kg) 2008/09 2009/10 t 60 Forecast 325 PRODUCTION (000 metric tons) EXPORTS (000 metric tons) 475 US 87,001 72,859 80,749 90,336 US 30,386 31,538 34,925 36,469 45 Brazil Constant 2000 59,000 61,000 57,000 63,000 275 Brazil 23,485 25,364 29,986 23,750 Argentina 350 48,800 46,200 32,000 53,000 Argentina 9,559 13,837 5,746 10,150 China 15,967 14,000 15,500 14,500 Paraguay 4,361 5,400 2,400 4,900 30 225 India 7,690 9,470 9,100 8,800 Canada 1,683 1,753 2,017 2,000 225 Paraguay 5,856 6,900 3,900 6,700 World 71,310 79,519 76,891 79,609 15CanadaCurrent 3,466 2,696 3,336 3,500 IMPORTS 175 (000 metric tons) World 100 237,117 221,129 210,870 250,254 China 28,726 37,816 41,098 41,000 2020 CRUSHINGS 1980 1985 1990 tons) (000 metric 1995 2000 2005 2010 2015 2020 EU-27 15,291 15,123 13,000 12,700 0US 49,198 49,081 45,232 46,130 125 Japan 4,094 4,014 3,396 3,950 Source: World Bank Jan-00 China Jan-02 35,970 Jan-06 Jan-04 39,518 Jan-08 41,035 Jan-10 44,480 Jan-00 Mexico Jan-02 Jan-04 3,844 Jan-06 3,614 Jan-08 3,100 Jan-10 3,535 Source: World Bank Source: World Bank Argentina 33,586 34,607 31,911 35,000 Taiwan 2,436 2,149 2,120 2,250 Brazil Tea 31,109 32,114 31,400 31,840 Thailand 1,532 1,753 1,510 1,705 EU-27 14,670 COCOA ICCO Current 14,870 ($/kg) 12,830 Constant 2000 12,300 Indonesia 1,309 Current 1,147 Constant 1,200 2000 1,600 100 325 400 India 6,615 8,170 7,500 7,900 Turkey 1,268 1,277 1,030 1,280 Mexico 3,900 3,675 Forecast 3,215 3,615 World 69,062 78,162 75,966 77,790 Constant 2000 Forecast 275 75Japan 2,925 2,890 2,496 2,750 325 (000 metric tons) STOCKS Taiwan Constant 2000 2,161 1,965 1,850 1,970 Argentina 22,606 21,760 16,028 22,550 Russia 805 1,051 1,497 1,810 Brazil 18,190 18,902 11,666 16,276 50 225 250 Bolivia 1,670 1,160 1,400 1,700 China 2,700 4,245 9,008 8,998 Paraguay 1,355 1,400 1,500 1,550 US 15,617 5,580 3,761 6,946 25World 175 195,659 201,929 192,634 202,951 World 175 62,885 52,908 42,407 57,093 Source: US Department of Agriculture Current 0 125 Current 100 Jan-10 GlobalJan-00 1980Commodity 1985 Jan-02 1995 Jan-04 Markets 1990 2000 Jan-06 2010 2005 Jan-08 2015 2020 Jan-10 1980 1985 1990 1995 2000 2005 2010 2015 Bank World 2020 Source: Source: World World Bank Bank Source: World Bank Current Constant 2000 Forecast 2.5 3 525 475 Sugar 2 2.0 400 Constant 2000 23 350 1.5 Sugar prices averaged 40 cents/kg in 2009, almost 42 Brazil has long been the world’s largest sugar sup- 1 percent higher than in 2008, and they averaged more 275 currently accounting for almost half of global ex- plier, 225 1.0 than 50 cents/kg during the last five months of 2009. although 60 percent of its sugarcane production ports Current 0 Sugar is among the few commodities whose prices 150 0.5 is used as feedstock for ethanol. Most Brazilian sug- 100 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 1985 Jan-02 1980 1990 Jan-04 2000 Jan-06 1995 2005 Jan-08 Jan-10 rose continually Source: World Bank during 2009. The rally began when it arcane processors have flexibility to 2010 switch 2015 2020 between 198 Source: World Bank Sour became clear that global supplies in 2008/09 would be sugar and ethanol production. Higher crude oil prices limited, due to a weather-induced production shortfall encourage Brazilian ethanol Current production at the expense 600 Sugar Current Constant 2000 Constant 2000 3.0 of 44 percent in India. India’s 2009/10 output is ex- of sugar output, thus boosting sugar prices. In view of Forecast Monthly Prices($/metric ton) Forecast pected to be equally disappointing. The shortfall has 60 current global sugar balance and crude the oil pric- 325 2.5 475 made India the world’s largest sugar importer (it im- es, sugar prices are projected to average 35 cents/kg 2.0 ported 2.8 million tons in 2008/09 and is projected to in452010, Constant down 2000 from 40 cents/kg in 2009, with some 275 Constant 2000 350 import 6 million tons in 2009/10). further declines in 2011 and 2012. These price levels 1.5 The US Department of Agriculture update of No- 30 more than double those of the early 2000s. Sugar are 225 225 vember 1.0 2009 projects global sugar production at 153.5 prices could decline further if global production recov- 15 more Current 175 million tons Current in 2009/10, as Brazil along with the EU-27 ers strongly from recent weakness, especially in 0.5 100 and a number of smaller producers respond to high India. Conversely, if crude oil prices increase further 1980 1985 1990 1995 2000 2005 2010 2015 2020 0 1980 ethanol 1985 1990 1995 2000 2005 2010 2015 2020 125 prices. Source:This is still below the estimated 160 million tons World Bank Source: World Bank production will become more profit- Brazilian Jan-00 Jan-02 projected consumption. able, putting Source: World Bank pressure Jan-06 upward Jan-04 on sugar Jan-08 prices. Jan-10 Ja So Sugar Monthly Prices (cents/kg) Tea Annual Prices (cents/kg) Monthly Prices($/metric ton) COCOA ICCO ($/kg) Current Constant 2000 60 100 325 400 Forecast 45 75 275 325 Constant 2000 30 50 225 250 15 25 175 175 0 0 125 Current 100 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 1980 1985 Jan-02 1990 1995 Jan-04 2000 Jan-06 2010 2005 Jan-08 2015 2020Jan-10 1 Source: World Bank Source: Source: World World Bank Bank S Current Constant 2000 Global market data Current Constant 2000 100 400 2006/07 2007/08 2008/09 Forecast 2009/10 2006/07 2007/08 2008/09 2009/10 PRODUCTION (000 metric tons) EXPORTS (000 metricConstant 2000 tons) Forecast 75 325 Brazil 31,450 31,600 31,850 35,750 Brazil 20,850 19,500 21,550 23,850 India Constant 2000 30,780 28,630 16,130 17,300 Thailand 4,705 4,914 5,500 5,800 50 EU-27 17,757 15,614 13,570 15,485 250 Australia 3,860 3,700 3,522 3,700 China 12,855 15,898 13,317 13,161 UAE 1,600 1,715 1,656 1,700 Thailand 6,720 7,820 7,200 7,700 Guatemala 1,500 1,333 1,490 1,515 25 175 US 7,662 7,396 6,789 6,998 EU-27 2,439 1,656 1,105 1,475 Mexico 5,633 5,852 5,260 5,400 Colombia Current 942 661 630 1,035 Australia 0 Current 5,212 4,939 4,814 4,900 South 100Africa 1,267 1,154 1,000 900 Pakistan 1980 1985 1990 1995 3,6152000 4,163 20103,512 2005 2015 3,520 2020 World1980 1985 1990 51,227 1995 2000 51,433 2005 48,180 2010 51,277 2015 2020 Russian Source: Fed. World Bank 3,150 3,200 3,480 3,350 IMPORTS (000 metric Source: tons) World Bank Indonesia 1,900 1,900 2,680 2,960 India 0 0 2,800 6,000 Colombia 2,354 2,245 2,050 2,575 EU-27 3,530 2,948 3,250 3,500 South Africa 2,313 2,360 2,350 2,380 Russia Fed. 2,950 3,100 2,800 2,400 Argentina 2,440 2,190 2,420 2,250 US 1,887 2,377 2,796 2,200 World 164,467 163,297 143,781 153,527 Korea, Rep. 1,518 1,648 1,550 1,600 STOCKS (000 metric tons) UAE 1,774 1,900 1,580 1,550 India 9,850 9,150 3,690 3,480 Malaysia 1,670 1,430 1,540 1,530 EU-27 2,720 3,130 2,175 3,185 Indonesia 1,800 2,420 1,570 1,500 Thailand 1,745 2,651 2,351 2,151 Canada 1,191 1,416 1,444 1,450 China 1,401 3,965 3,464 2,047 Egypt 936 1,390 1,410 1,410 Egypt 383 544 746 936 Japan 1,350 1,372 1,450 1,313 US 1,632 1,506 1,317 922 Saudi Arabia 1,515 1,670 1,285 1,300 World 35,769 39,776 27,570 26,002 World 43,975 44,384 46,568 49,921 Source: US Department of Agriculture Global Commodity Markets World Bank Forecast Forecast 2.5 525 475 2.0 24 400 Constant 2000 350 Constant 2000 Tea 1.5 Tea prices (the three-auction average) were 272 cents/ Compared to that of many other commodities, tea 275 225 consumption has been less affected by the economic 1.0 kg during 2009, 13 percent higher than in 2008 and well above their 172 cents/kg average of 2000-07. After downturn, Current even though demand for some premium- Current 0.5 150 a sharp fall during 2008:Q3, reflecting the credit crunch 100 grade teas has declined. In India, domestic demand has Jan-10 1980 Jan-00 1985 Jan-02 1990 Jan-042000 1995 2005 Jan-06 2015 2010 Jan-08 2020 Jan-10 1980 1985 1990 1995 2000 2005 2010 2015 2020 and the ensuing global economic downturn, tea prices been boosted by consumers’ rising purchasing power, Source:World Source: WorldBank Bank Source: World Bank climbed steeply to an all-time high of more than 300 which in turn has driven exports down. Early estimates cents/kg in nominal Current terms during 2009:Q4. for 2009 export volumes show an 8 percent decline in 600Sugar Tea Constant 2000 Preliminary data show that tea production was low- Kenya and 3 percent declines in India and Sri Lanka. Monthly Prices($/metric ton) COCOA ICCO ($/kg) 60 er in 2009 than in 2008, with production Forecast in the three 325 Despite the lower export volumes, global export rev- 475 principal black tea suppliers—Kenya, Sri Lanka, and enues from tea increased in 2009 due to high prices. Constant 2000 45 India—declining by 11, 7, and 4 percent, respectively, 275Tea prices in 2010 are expected to average 230 350 or total fall of 95 thousand tons. The Kenyan crop was cents/kg. The medium-term price forecast is 210 cents/ 30 plagued by a two-year drought compounded by civil 225 as supply is expected to respond to the recent high kg, 225 disturbance in early 2008; the Sri Lankan crop was re- prices. Over the longer term, prices will be shaped by 15 duced Current by high costs of transport, energy products, in- 175 growing domestic demand from India, input costs, ris- 100 sufficient application of fertilizer (due to high prices ing demand for higher-grade teas and organic teas, as 2020 1980 0 and 1985 1990 1995 2000 2005 2010 2015 2020 125 as by concern of climate changes. drought), Source: World Bank and labor strikes. well Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Source: World Bank Source: World Bank Tea Monthly Prices (cents/kg) Annual Prices (cents/kg) Current Constant 2000 COCOA ICCO ($/kg) Current Constant 2000 100 325 400 Forecast Constant 2000 Forecast 75 275 325 Constant 2000 50 225 250 25 175 175 Current 0 125 Current 100 Jan-10 1980 Jan-001985 Jan-02 1995 Jan-04 1990 2000 2005 Jan-062010 2015 Jan-08 2020 Jan-10 1980 1985 1990 1995 2000 2005 2010 2015 2020 Source: World Source: Bank World Bank Source: World Bank Current Constant 2000 Global market data 400 2005 2006 2007 2008 2005 2006 2007 2008 PRODUCTION Constant 2000 tons) (000 metric Forecast GROSS EXPORTS (000 metric tons) 325 China 935 1,028 1,140 1,200 Kenya 348 312 344 383 India 946 982 945 981 Sri Lanka 299 315 294 298 Kenya 250 324 311 370 346 China 287 287 289 297 Sri Lanka 317 311 305 319 India 195 216 176 193 Vietnam 133 143 148 166 Vietnam 88 105 111 104 175 Turkey 135 142 178 155 Indonesia 102 95 84 96 IndonesiaCurrent 156 147 137 138 Argentina 66 71 75 77 Japan 100 100 100 92 93 Malawi 43 42 47 40 2020 Argentina 1980 1985 1990 1995 80 2000 88 2005 2010 872015 72 2020 World 1,566 1,579 1,573 1,638 Bangladesh Source: World Bank 61 53 58 59 NET IMPORTS (000 metric tons) Uganda 38 37 45 43 Russian Fed. 173 166 174 175 Malawi 38 45 48 42 UK 128 135 131 130 Tanzania 30 31 35 32 US 100 108 109 117 Myanmar 18 18 18 19 Pakistan 139 117 106 99 Iran, Islam. Rep. 25 20 17 18 Egypt 74 79 69 94 Taiwan, China 19 19 18 17 Dubai 62 69 72 79 Rwanda 16 17 18 17 Other CIS 53 56 58 60 Nepal 13 14 15 16 Iran, Islamic Rep. 43 50 55 58 Zimbabwe 15 16 14 8 Morroco 50 51 53 48 PNG 7 7 7 7 Japan 51 48 47 43 Burundi 8 6 7 6 Iraq 58 67 32 36 World 3,458 3,580 3,751 3,804 World 1,469 1,487 1,490 1,532 Sources: International Tea Committee, F.O. Lichts and World Bank estimates Global Commodity Markets World Bank Wheat 25 Wheat prices averaged $224/ton in 2009, down 31 per- Despite the marginal reduction in output projected cent from 2008, and reached a low of $190/ton in Sep- for 2009/10, the rebuilding of stocks and the relative tember 2009. The 2008 rally, partly fuelled by strong price weakness during the second half of 2009 sug- biofuel demand for competing crops, occurred despite gests that the global wheat market is well supplied. a record wheat crop in 2008/09. The US Department International wheat trade is expected to decline by 12 of Agriculture (November-2009) expects global wheat percent in 2009/10, but exceeds the 2007/08 crop-year production to decline somewhat in 2009/10; a likely level by more than seven million tons (6 percent high- Wheat C shortfall in the EU will be offset by increases in several er). Barring any unfavorable weather event, prices are Monthly Prices($/metric ton) smaller producers. 450 expected to average $225/ton in 2010, similar to their 4 Stocks are projected to increase for the second 2009 average, and only a moderate price increase is straight year, pushing the stock-to-use ratio to 0.30, 350 expected for 2011. Such a forecast is subject to upside 3 well above its 2007/08 record low of 0.20 and in line risks if crude oil prices increase further (putting indi- with the long-term historical average. Almost two 250 pressure on wheat as prices of biofuel crops such rect 2 thirds of global stocks will be held by the world’s four as maize and rye rise in tandem with energy prices). key suppliers: China, the US, India, and the EU. The In150 the longer term, real wheat prices are expected to 1 inventory build-up by some countries has been moti- remain well above the averages experienced during vated by food security concerns. the50 early 2000s. 0 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 Jan- Source: World Bank Sour Wheat Monthly Prices ($/metric ton) Cocoa Annual Prices ($/metric ton) Monthly Prices($/metric ton) Current Constant 2000 COCOA ICCO ($/kg) 450 450 4 4 Forecast 350 350 3 3 250 250 2 2 Constant 2000 150 150 1 1 Current 50 50 0 0 Jan-00 Jan-02 Jan-04 Jan-06 Jan-08 Jan-10 1980 Jan-00 1990 1985 Jan-02 1995 Jan-04 2000 2005 Jan-06 2015 2010Jan-08 2020 Jan-10 198 Source: World Bank Source: World Bank Sou Current Constant 2000 Global market data Cotton Current Constant 2000 A 450 4 2006/07 2007/08 2008/09 2009/10 2006/07 2008/09 2007/08 ton) Monthly Prices($/metric 2009/10 Forecast 2.00 Constant 2000 tons) Forecast 3200 PRODUCTION (000 metric tons) EXPORTS (000 metric 350 3 EU-27 124,870 120,133 151,072 138,339 US 1.75 24,725 34,363 27,637 23,814 China 108,466 109,298 112,464 114,500 EU-27 13,816 12,271 25,390 19,000 2700 250India 69,350 75,810 78,600 80,580 Canada 19,434 16,116 18,812 18,500 1.50 2 US Constant 2000 49,217 55,821 68,016 60,314 Russian Fed. 10,584 12,552 18,393 18,000 2200 Russian Fed. 44,900 49,400 63,700 59,500 Australia Current 8,728 7,487 14,800 15,000 150 1.25 1 Canada 25,265 20,054 28,611 26,500 Ukraine 3,366 1,236 13,037 9,000 Pakistan 21,277 23,300 21,500 24,000 Kazakhstan 8,089 8,181 5,701 7,500 1700 Current 1.00 Australia 50 10,822 13,569 20,939 22,500 Argentina 0 10,709 11,193 6,000 2,500 Ukraine 14,000 13,900 25,900 20,500 Turkey 2,377 1,722 2,238 2,300 1980 1985 1990 1995 2000 2005 2010 2015 2020 0.75 1980 1985 1990 1995 2000 2005 2010 2015 2020 1200 Turkey 17,500 15,500 16,800 17,800 Mexico 548 1,261 1,406 1,200 Source: World Bank Source: World Bank Kazakhstan 13,450 16,450 12,550 17,000 Jan-00 World Jan-02 Jan-04 111,636 Jan-06 117,202 Jan-08 142,288 Jan-10 124,673 Jan- Iran, Islamic Rep. 14,500 15,000 10,000 12,000 Source: World IMPORTS Bank tons) (000 metric Sour Cotton Argentina 16,100 18,000 8,400 8,000 Egypt Aluminum 7,300 7,700 9,900 8,300 World 610,430 ton)682,034 595,720Prices($/metric Monthly 673,862 EU-27 5,137 ICCO ($/kg) Current COCOA 6,942 7,740 Constant 2000 7,000 2.00 STOCKS (000 metric tons) 2.75 3200 Brazil 8,048 6,711 6,000 6,500 3000 China 38,450 38,963 48,685 60,585 Indonesia Constant 2000 5,596 5,224 Forecast 5,500 5,423 1.75 US 12,414 8,323 17,867 24,485 Algeria 4,874 5,904 6,359 5,300 2.25 2700 2325 India 4,500 5,800 13,540 18,050 Japan 5,747 5,701 5,156 5,300 1.50 EU-27 14,075 12,343 18,265 17,604 Iran, Islamic Rep. 1,100 200 6,700 4,500 Russian Fed. 2,231 1,819 8,429 9,429 Iraq 1.75 2200 2,912 3,424 3,868 3,800 1650 Canada 1.25 6,865 4,406 6,556 7,656 Korea, Rep. 3,439 3,092 3,371 3,700 Egypt 4,120 4,120 5,343 4,483 Nigeria Current 3,265 2,677 3,550 3,500 1.25 1700 975 World 1.00 127,531 121,006 163,753 190,909 World 114,585 113,391 136,359 120,359 Source: US Department of Agriculture 0.75 0.75 1200 300 Global Commodity Jan-00 Markets Jan-04 Jan-02 Jan-06 Jan-08 Jan-10 1980 Jan-00 1985 Jan-02 1990 Jan-04 2000 1995 2005 Jan-06 2015 2010Jan-08 Bank World 2020 Jan-10 19 Source: World Bank World Bank Source: World Source: Bank So 26 Appendix A: Prices and Forecasts Table A1: Commodity Price Data 2007 2008 2009 2008 2009 2009 2009 2009 2009 2009 2009 Jan-Dec Jan-Dec Jan-Dec Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec Oct Nov Dec Energy Coal, Australia a/ $/mt 65.73 127.10 71.75 92.97 71.93 66.48 71.31 77.29 71.07 78.80 82.00 Crude oil, average a/ $/bbl 71.12 96.99 61.76 56.00 44.11 59.19 68.21 75.50 74.08 77.55 74.88 Crude oil, Brent a/ $/bbl 72.70 97.64 61.86 55.89 44.98 59.13 68.37 74.97 73.19 77.04 74.67 Crude oil, Dubai a/ $/bbl 68.37 93.78 61.75 53.67 44.56 58.93 68.07 75.46 73.28 77.63 75.49 Crude oil, West Texas Int. a/ $/bbl 72.28 99.56 61.65 58.45 42.80 59.52 68.21 76.08 75.77 78.00 74.49 Natural gas Index a/ 2000=100 186.5 267.9 153.4 266.2 198.2 142.9 123.3 149.3 142.8 141.4 163.8 Natural gas, Europe a/ $/mmbtu 8.56 13.41 8.71 15.75 11.94 8.18 6.91 7.81 7.60 7.81 8.01 Natural gas, US a/ $/mmbtu 6.98 8.86 3.95 6.40 4.57 3.70 3.17 4.36 4.02 3.70 5.35 Natural gas LNG, Japan a/ $/mmbtu 7.68 12.53 8.93 14.62 10.90 7.60 7.91 9.30 9.10 9.30 9.50 Non Energy Agriculture Beverages Cocoa b/ ¢/kg 195.2 257.7 288.9 224.1 259.4 257.9 296.4 342.0 336.0 338.5 351.4 Coffee, Arabica b/ ¢/kg 272.4 308.2 317.1 267.8 283.9 320.2 322.7 341.7 340.8 335.6 348.7 Coffee, robusta b/ ¢/kg 190.9 232.1 164.4 192.6 175.8 165.3 160.1 156.4 162.1 153.2 154.1 Tea, auctions (3) average b/ ¢/kg 203.6 242.0 272.5 206.6 218.0 266.1 303.6 302.5 302.7 305.6 299.1 Tea, Colombo auctions b/ ¢/kg 252.2 278.9 313.7 208.8 261.7 299.1 356.1 338.0 352.4 335.0 326.7 Tea, Kolkata auctions b/ ¢/kg 192.1 225.5 252.0 220.2 177.4 271.3 273.0 286.2 294.4 291.2 273.0 Tea, Mombasa auctions b/ ¢/kg 166.5 221.8 252.0 190.8 214.9 228.0 281.7 283.2 261.3 290.6 297.7 Food Fats and Oils Coconut oil b/ $/mt 919 1,224 725 772 677 779 711 734 706 729 767 Copra $/mt 607 816 480 520 447 513 469 491 470 493 509 Groundnut oil b/ $/mt 1,352 2,131 1,183 1,773 1,283 1,166 1,133 1,150 1,148 1,116 1,187 Palm oil b/ $/mt 780 949 683 512 577 743 679 732 680 725 791 Palmkernel oil $/mt 888 1,130 694 609 577 763 700 737 728 726 758 Soybean meal b/ $/mt 308 424 408 320 365 424 431 412 413 422 401 Soybean oil b/ $/mt 881 1,258 849 830 755 863 856 920 897 931 933 Soybeans b/ $/mt 384 523 437 377 394 461 454 439 427 440 451 Grains Barley b/ $/mt 172.4 200.5 128.3 129.5 116.3 129.5 122.0 145.5 130.7 155.3 150.6 Maize b/ $/mt 163.7 223.1 165.5 168.4 166.9 176.0 151.3 167.8 167.3 171.6 164.6 Rice, Thailand, 5% b/ $/mt 326.4 650.2 555.0 564.4 586.3 552.4 539.0 542.3 493.0 542.8 591.0 Rice, Thailand, 25% $/mt 306.5 n.a. 458.1 449.9 469.4 458.7 441.4 462.8 412.8 460.3 515.3 Rice, Thailand, 35% $/mt 300.1 n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. n.a. Rice,Thai, A.1 $/mt 272.3 482.3 326.4 314.1 323.4 326.3 309.7 346.1 298.4 337.0 403.0 Sorghum $/mt 162.7 207.8 151.1 151.0 145.3 155.8 139.3 163.8 159.0 166.0 166.3 Wheat, Canada $/mt 300.4 454.6 300.5 322.1 321.9 325.6 271.2 283.2 274.1 288.4 287.2 Wheat, US, HRW b/ $/mt 255.2 326.0 224.1 228.1 231.6 250.5 208.8 205.4 198.8 211.0 206.3 Wheat, US SRW $/mt 238.6 271.5 186.0 182.7 187.4 195.6 165.2 195.6 175.6 204.7 206.5 Other Food Bananas EU $/mt 1,037 1,188 1,145 944 1,142 1,288 1,118 1,031 1,080 1,027 986 Bananas US b/ $/mt 676 844 847 847 891 858 826 812 810 834 794 Fishmeal $/mt 1,177 1,133 1,230 1,023 1,013 1,097 1,276 1,535 1,427 1,526 1,651 Meat, beef b/ ¢/kg 260.3 313.8 263.6 268.0 245.2 262.8 273.2 273.5 264.8 275.6 280.0 Meat, chicken b/ ¢/kg 156.7 169.6 171.7 174.7 173.5 174.1 173.9 165.1 166.1 164.6 164.7 Meat, sheep ¢/kg 412.0 458.5 427.6 410.0 378.5 428.7 453.3 450.1 445.8 457.0 447.5 Oranges b/ $/mt 957 1,107 909 842 799 870 861 1,107 1,153 1,154 1,014 Shrimp, Mexico b/ ¢/kg 1,010 1,069 945 1,014 976 970 970 864 937 863 794 Sugar EU b/ ¢/kg 68.09 69.69 52.44 51.97 51.44 53.76 55.43 49.11 48.78 49.63 48.92 Sugar US b/ ¢/kg 45.77 46.86 54.88 44.72 43.82 47.89 57.31 70.48 67.78 70.25 73.42 Sugar, world b/ ¢/kg 22.22 28.21 39.91 26.28 28.85 33.89 46.98 49.93 49.91 49.07 50.81 Continued on next page Global Commodity Markets World Bank Appendix A: Prices and Forecasts 27 Table A1: Commodity Price Data (Continued from previous page) 2007 2008 2009 2008 2009 2009 2009 2009 2009 2009 2009 Jan-Dec Jan-Dec Jan-Dec Oct-Dec Jan-Mar Apr-Jun Jul-Sep Oct-Dec Oct Nov Dec Raw Materials Timber Logs, Cameroon $/cum 381.3 526.9 421.5 473.8 426.8 394.8 414.9 449.5 444.5 451.1 452.7 Logs, Malaysia b/ $/cum 268.0 292.3 287.2 315.7 313.6 284.5 279.6 271.1 276.6 272.0 264.8 Plywood ¢/sheets 640.7 645.5 564.6 645.5 572.8 565.8 561.5 558.4 559.3 558.6 557.2 Sawnwood, Cameroon $/cum 759.8 958.3 748.9 770.8 689.2 721.2 779.0 806.3 790.0 821.0 807.7 Sawnwood, Malaysia b/ $/cum 806.3 889.1 805.5 859.9 813.7 829.7 771.4 807.4 805.1 821.1 796.0 Woodpulp $/mt 767.0 820.2 616.2 711.0 565.1 550.0 627.7 721.8 693.5 722.0 750.0 Other Raw Materials Cotton A Index b/ ¢/kg 139.5 157.4 138.3 126.9 120.8 132.4 141.9 158.0 147.3 157.7 169.1 Cotton Memphis ¢/kg 142.9 161.3 144.2 129.4 122.4 137.5 148.8 168.1 163.7 171.5 169.2 Rubber RSS1, US ¢/kg 248.0 284.1 214.6 202.8 165.8 187.0 221.0 284.7 264.8 279.3 310.0 Rubber RSS3, SGP b/ ¢/kg 226.3 258.6 192.1 159.0 146.0 166.4 199.3 256.5 235.2 254.2 280.1 Fertilizers DAP b/ $/mt 432.5 967.2 323.1 663.3 362.2 303.6 309.6 316.9 300.1 290.3 360.4 Phosphate rock b/ $/mt 70.9 345.6 121.7 371.3 193.3 113.3 90.0 90.0 90.0 90.0 90.0 Potassium chloride b/ $/mt 200.2 570.1 630.4 766.7 865.2 726.7 506.8 423.0 435.0 435.0 399.0 TSP b/ $/mt 339.1 879.4 257.4 658.7 321.7 247.7 224.7 235.7 246.5 228.5 232.0 Urea b/ $/mt 309.4 492.7 249.6 292.2 267.3 241.1 241.6 248.3 239.0 244.8 261.1 Metals and Minerals Aluminum b/ $/mt 2,638 2,573 1,665 1,821 1,360 1,485 1,812 2,003 1,879 1,949 2,180 Copper b/ $/mt 7,118 6,956 5,150 3,905 3,428 4,663 5,859 6,648 6,288 6,676 6,982 Gold $/toz 697 872 973 795 909 922 960 1,102 1,043 1,127 1,135 Iron ore b/ ¢/dmtu 84.7 140.6 101.0 140.6 101.0 101.0 101.0 101.0 101.0 101.0 101.0 Lead b/ ¢/kg 258.0 209.1 171.9 124.5 115.7 149.9 192.8 229.3 224.1 230.9 232.9 Nickel b/ $/mt 37,230 21,111 14,655 10,843 10,471 12,920 17,700 17,528 18,525 16,991 17,066 Silver ¢/toz 1,341 1,500 1,469 1,020 1,265 1,376 1,477 1,760 1,726 1,788 1,764 Steel products index c/ 2000=100 182.0 289.3 227.1 310.4 274.5 215.5 210.8 207.5 210.4 206.8 205.2 Steel cr coilsheet c/ $/mt 650 966 783 1,100 1,033 700 700 700 700 700 700 Steel hr coilsheet c/ $/mt 550 883 683 1,000 933 600 600 600 600 600 600 Steel rebar c/ $/mt 522 760 486 630 473 450 500 522 580 495 490 Steel wire rod c/ $/mt 533 1,010 970 1,200 1,200 1,007 857 816 850 825 773 Tin b/ ¢/kg 1,454 1,851 1,357 1,310 1,103 1,351 1,459 1,517 1,501 1,494 1,555 Zinc b/ ¢/kg 324.2 187.5 165.5 118.5 117.2 147.3 176.1 221.4 207.2 219.3 237.6 World Bank Commodity Price Indices (2000 =100) Energy 244.8 342.0 214.3 212.9 166.3 204.5 230.3 256.0 249.9 261.5 256.5 Non Energy 224.7 272.0 213.1 206.3 189.9 207.8 219.8 235.1 228.3 235.3 241.7 Agriculture 180.3 229.5 197.7 178.6 181.9 197.1 199.5 212.4 206.6 213.2 217.3 Beverages 169.9 210.0 219.9 181.2 197.9 207.3 226.4 248.0 246.0 245.4 252.6 Food 184.7 247.4 205.0 185.7 190.4 209.8 206.4 213.5 207.8 215.3 217.4 Fats and Oils 209.0 277.3 216.2 182.4 191.4 227.9 220.9 224.5 217.0 225.6 231.0 Grains 189.0 281.7 214.9 218.6 221.3 225.3 202.3 210.8 201.0 214.3 217.0 Other Food 149.0 177.1 181.5 160.2 161.3 172.1 191.2 201.4 201.8 202.7 199.8 Raw Materials 174.9 195.7 168.7 160.0 153.1 161.1 168.9 191.7 183.7 191.8 199.4 Timber 136.8 150.5 138.9 149.4 143.1 141.8 133.6 137.3 137.6 139.2 135.1 Other Raw Materials 216.6 245.3 201.2 171.6 164.0 182.2 207.5 251.1 234.2 249.4 269.7 Fertilizers 240.1 566.7 293.0 492.2 376.6 300.6 252.1 242.8 242.7 242.2 243.5 Metals and Minerals 314.0 325.7 235.6 230.6 185.0 219.0 257.6 280.8 271.2 279.8 291.4 a/ Included in the energy index (2000=100) b/ Included in the non-energy index (2000=100) c/ Steel not included in the non-energy index Sources include: Africa Tea Brokers Ltd Weekly Market Report, Bloomberg, Canadian Grain Commission, Canadian Wheat Board, Cotton Outlook, Coal Week International, Fertilizer International, Fertilizer Week, FRuiTROP, INFOFISH, INTERFEL Fel Actualités hebdo, International Cocoa Organization, International Coffee Organization, Interna- tional Rubber Study Group, International Tea Committee, International Tropical Timber Organization, Internatonal Sugar Organization, ISTA Mielke GmbH Oil World, Japan Lumber Journal, Japan Metal Bulletin, Meat Trades Journal, MLA Meat & Livestock Weekly, Platts International Coal Report, Platts Metals Week, Singapore Commodity Exchange, Sopisco News, Sri Lanka Tea Board, Statistisches Bundesamt, US Department of Agriculture, US NOAA Fisheries Service, Vale and World Gas Intelligence. Global Commodity Markets World Bank 28 Appendix A: Prices and Forecasts Table A2: Commodity Prices and Price Forecast in Current Dollars Actual Forecast 1970 1980 1990 2000 2009 2010 2011 2012 2015 2020 Energy Coal, Australia $/mt 7.8 40.1 39.7 26.3 71.8 80.0 85.0 85.0 75.0 80.0 Crude oil, average $/bbl 1.2 36.9 22.9 28.2 61.8 76.0 76.6 76.6 77.8 79.8 Natural gas, European $/mmbtu 0.4 4.2 2.8 3.9 8.7 8.3 8.5 8.8 9.5 10.0 Natural gas, US $/mmbtu 0.2 1.6 1.7 4.3 3.9 6.0 7.0 7.5 9.0 9.5 LNG, Japanese $/mmbtu n.a. 5.7 3.6 4.7 8.9 8.8 9.0 9.3 10.0 10.5 Non-Energy Agriculture Beverages Cocoa ¢/kg 68 260 127 91 289 300 240 180 175 170 Coffee, arabica ¢/kg 115 347 197 192 317 270 255 250 255 230 Coffee, robusta ¢/kg 91 324 118 91 164 178 177 175 180 150 Tea, auctions (3) average ¢/kg 84 166 206 188 273 230 210 205 212 225 Food Fats and Oils Coconut oil $/mt 397 674 337 450 725 750 750 800 850 715 Groundnut oil $/mt 379 859 964 714 1,183 1,325 1,340 1,345 1,325 1,110 Palm oil $/mt 260 584 290 310 683 660 670 700 780 715 Soybean meal $/mt 103 262 200 189 408 350 330 316 308 304 Soybean oil $/mt 286 598 447 338 849 800 810 820 850 800 Soybeans $/mt 117 296 247 212 437 410 403 396 375 375 Grains Barley $/mt n.a. 78 80 77 128 140 145 148 160 173 Maize $/mt 58 125 109 89 166 166 167 168 174 175 Rice, Thailand, 5% $/mt 126 411 271 202 555 460 462 464 470 483 Wheat, US, HRW $/mt 55 173 136 114 224 225 230 235 250 260 Other Food Bananas, US $/mt 166 377 541 424 847 850 847 826 710 605 Meat, beef ¢/kg 130 276 256 193 264 265 270 275 290 325 Meat, chicken ¢/kg n.a. 69 98 119 172 169 171 174 181 197 Oranges $/mt 168 400 531 363 909 900 941 951 950 900 Shrimp ¢/kg n.a. 1,152 1,069 1,515 945 875 907 941 1,050 1,150 Sugar, world ¢/kg 8.2 63.2 27.7 18.0 40.0 35.0 34.0 33.8 34.0 38.0 Agricultural Raw Materials Timber Logs, Cameroonian $/cum 43 252 343 275 421 450 450 449 445 490 Logs, Malaysian $/cum 43 196 177 190 287 270 273 276 285 320 Sawnwood, Malaysian $/cum 175 396 533 595 806 810 817 824 845 970 Other Raw Materials Cotton ¢/kg 68 206 182 130 138 137 135 138 145 140 Rubber, Malaysian ¢/kg 41 142 86 67 192 160 170 175 190 185 Tobacco $/mt 1,076 2,276 3,392 2,976 4,223 4,000 3,600 3,505 3,500 3,500 Fertilizers DAP $/mt 54 222 171 154 323 300 310 322 360 400 Phosphate rock $/mt 11 47 41 44 122 100 90 86 80 95 Potassium chloride $/mt 32 116 98 123 630 400 300 274 255 220 TSP $/mt 43 180 132 138 257 270 290 298 310 340 Urea $/mt 18 192 119 101 250 225 185 190 200 245 Metals and Minerals Aluminum $/mt 614 1,775 1,639 1,549 1,665 2,000 2,100 2,200 2,500 2,600 Copper $/mt 1,416 2,182 2,661 1,813 5,150 7,000 7,500 6,500 5,000 5,100 Gold $/toz 36 608 383 279 973 1,000 975 950 850 900 Iron ore ¢/dmtu 9.8 28.1 32.5 28.8 101.0 120.0 120.0 110.0 80.0 85.0 Lead ¢/kg 30 91 81 45 172 225 240 230 180 190 Nickel $/mt 2,846 6,519 8,864 8,638 14,655 17,500 19,000 18,000 15,000 16,000 Silver c/toz 176 2,064 482 500 1,469 1,550 1,525 1,500 1,350 1,400 Tin ¢/kg 367 1,677 609 544 1,357 1,650 1,800 1,700 1,400 1,500 Zinc ¢/kg 30 76 151 113 166 225 250 230 170 180 Projections as of January 7, 2010. Global Commodity Markets World Bank Appendix A: Prices and Forecasts 29 Table A3: Commodity Prices and Price Forecast in Constant 2000 Dollars Actual Forecast 1970 1980 1990 2000 2009 2010 2011 2012 2015 2020 Energy Coal, Australia $/mt 27.0 49.5 38.5 26.3 60.3 66.3 69.9 69.9 60.8 63.2 Crude oil, average $/bbl 4.2 45.5 22.2 28.2 51.9 63.0 63.0 63.0 63.1 63.1 Natural gas, Europe $/mmbtu 1.5 5.2 2.7 3.9 7.3 6.8 7.0 7.2 7.7 7.9 Natural gas, US $/mmbtu 0.6 2.0 1.7 4.3 3.3 5.0 5.8 6.2 7.3 7.5 LNG, Japan $/mmbtu n.a. 7.0 3.5 4.7 7.5 7.2 7.4 7.6 8.1 8.3 Non-Energy Agriculture Beverages Cocoa ¢/kg 234 321 123 91 243 249 197 148 142 134 Coffee, arabica ¢/kg 397 427 192 192 267 224 210 206 207 182 Coffee, robusta ¢/kg 316 400 115 91 138 147 146 144 146 119 Tea, auctions (3) average ¢/kg 289 205 200 188 229 191 173 169 172 178 Food Fats and Oils Coconut oil $/mt 1,376 831 327 450 610 621 617 658 689 565 Groundnut oil $/mt 1,311 1,059 936 714 995 1,098 1,102 1,106 1,074 877 Palm oil $/mt 901 720 282 310 574 547 551 576 632 565 Soybean meal $/mt 355 324 195 189 343 290 271 260 250 240 Soybean oil $/mt 992 737 435 338 713 663 666 674 689 632 Soybeans $/mt 405 365 240 212 367 340 331 325 304 296 Grains Barley $/mt n.a. 96 78 77 108 116 119 122 129 137 Maize $/mt 202 154 106 89 139 138 137 138 141 138 Rice, Thailand, 5% $/mt 438 506 263 202 467 381 380 382 381 382 Wheat, US, HRW $/mt 190 213 132 114 188 186 189 193 203 205 Other food Bananas, US $/mt 575 465 526 424 712 704 697 679 575 478 Meat, beef ¢/kg 452 340 249 193 222 220 222 226 235 257 Meat, chicken ¢/kg n.a. 85 96 119 144 140 141 143 147 155 Oranges $/mt 582 493 516 363 764 746 774 782 770 711 Shrimp ¢/kg n.a. 1,420 1,039 1,515 795 725 746 774 851 909 Sugar, world ¢/kg 28.5 77.9 26.9 18.0 33.6 29.0 28.0 27.8 27.6 30.0 Agricultural Raw Materials Timber Logs, Cameroon $/cum 149 310 334 275 354 373 370 369 361 387 Logs, Malaysia $/cum 149 241 172 190 241 224 224 227 231 253 Sawnwood, Malaysia $/cum 608 489 518 595 677 671 672 678 685 767 Other Raw Materials Cotton ¢/kg 234 254 177 130 116 113 111 114 117 111 Rubber, Asia ¢/kg 141 176 84 67 161 133 140 144 154 146 Tobacco $/mt 3,727 2,806 3,297 2,976 3,550 3,314 2,961 2,883 2,836 2,766 Fertilizers DAP $/mt 187 274 167 154 272 249 255 264 292 316 Phosphate rock $/mt 38 58 39 44 102 83 74 71 65 75 Potassium chloride $/mt 109 143 95 123 530 331 247 226 207 174 TSP $/mt 147 222 128 138 216 224 239 245 251 269 Urea $/mt 63 237 116 101 210 186 152 156 162 194 Metals and Minerals Aluminum $/mt 2,128 2,188 1,593 1,549 1,400 1,657 1,727 1,810 2,026 2,055 Copper $/mt 4,904 2,690 2,586 1,813 4,330 5,800 6,169 5,346 4,052 4,031 Gold $/toz 125 749 373 279 818 829 802 781 689 711 Iron ore ¢/dmtu 34 35 32 29 85 99 99 90 65 67 Lead ¢/kg 105 112 79 45 145 186 197 189 146 150 Nickel $/mt 9,860 8,037 8,614 8,638 12,322 14,499 15,628 14,805 12,155 12,646 Silver ¢/toz 609 2,544 468 500 1,235 1,284 1,254 1,234 1,094 1,106 Tin ¢/kg 1,273 2,068 591 544 1,141 1,367 1,481 1,398 1,134 1,186 Zinc ¢/kg 102 94 147 113 139 186 206 189 138 142 Projections as of January 7, 2010. Global Commodity Markets World Bank 30 Appendix A: Prices and Forecasts Table A4. Weighted Indices of Commodity Prices and Inflation, 2000=100 a/ Actual Forecast Index 1970 1980 1990 2000 2009 2010 2011 2012 2015 2020 Current dollars Energy 5.6 124.3 81.3 100.0 214.4 260.5 264.8 265.8 270.6 278.7 Non-energy commodities 53.0 143.5 118.6 100.0 213.1 224.4 226.0 215.5 201.3 205.4 Agriculture 54.4 157.8 116.4 100.0 197.7 186.2 182.9 180.7 185.2 185.8 Beverages 66.5 221.2 120.3 100.0 219.9 213.1 183.9 157.9 158.0 149.3 Food 58.0 161.8 118.9 100.0 205.0 193.0 192.9 193.9 198.0 197.3 Fats and Oils 68.4 158.7 108.0 100.0 216.2 201.7 199.5 200.3 206.1 195.5 Grains 58.9 161.0 124.7 100.0 214.9 201.7 203.8 205.8 213.4 218.7 Other Food 43.7 166.5 128.0 100.0 181.5 173.7 174.3 174.6 173.5 180.3 Raw Materials 39.3 115.7 108.2 100.0 168.7 156.0 158.0 160.2 167.8 176.4 Timber 28.0 74.6 90.4 100.0 138.9 137.5 138.8 140.0 143.8 164.3 Other Raw Materials 51.7 160.6 127.6 100.0 201.1 176.3 179.1 182.3 194.1 189.6 Fertilizers 23.6 143.9 101.2 100.0 293.0 238.7 205.2 202.8 203.3 226.4 Metals and Minerals 53.4 114.1 125.2 100.0 235.6 301.1 316.9 288.5 234.1 243.3 Constant 2000 dollars b/ Energy 19.3 153.2 79.0 100.0 180.2 215.8 217.8 218.6 219.3 220.3 Non-energy commodities 183.4 176.9 115.3 100.0 179.2 185.9 185.9 177.3 163.1 162.3 Agriculture 188.4 194.5 113.1 100.0 166.2 154.3 150.4 148.6 150.1 146.8 Beverages 230.4 272.7 116.9 100.0 184.9 176.6 151.3 129.9 128.0 118.0 Food 201.1 199.5 115.5 100.0 172.4 159.9 158.6 159.5 160.5 155.9 Fats and Oils 236.9 195.7 105.0 100.0 181.8 167.1 164.1 164.8 167.0 154.5 Grains 203.9 198.6 121.1 100.0 180.7 167.1 167.6 169.3 172.9 172.8 Other Food 151.4 205.3 124.4 100.0 152.6 143.9 143.4 143.6 140.6 142.5 Raw Materials 136.1 142.7 105.1 100.0 141.8 129.3 130.0 131.8 136.0 139.4 Timber 97.0 92.0 87.9 100.0 116.8 113.9 114.1 115.2 116.6 129.8 Other Raw Materials 178.9 198.0 124.0 100.0 169.0 146.1 147.4 149.9 157.3 149.9 Fertilizers 81.6 177.4 98.4 100.0 246.3 197.8 168.8 166.8 164.7 179.0 Metals and Minerals 184.9 140.7 121.7 100.0 198.1 249.5 260.7 237.3 189.7 192.3 Inflation indices, 2000=100 c/ MUV index f/ 28.87 81.11 102.90 100.00 118.93 120.70 121.58 121.58 123.41 126.53 % change per annum 10.88 2.41 -0.29 2.19 1.48 0.73 0.00 0.30 0.50 US GDP deflator 27.43 53.87 81.45 100.00 124.11 126.39 129.68 133.11 144.45 166.02 % change per annum 6.98 4.22 2.07 2.74 1.83 2.61 2.64 1.65 2.82 a/ Commodity price forecast as of January 7, 2010. b/ Computed from unrounded data and deflated by the MUV Index. c/ Inflation indices for 2008-2020 are forecast as of August 20, 2008. Growth rates for years 1980, 1990, 2000, 2009, 2015 and 2020 refer to compound annual rate of change between adjacent end-point years; all others are annual growth rates from the previous year. d/ Unit value index of global manufacture exports in US dollar terms. Sources: World Bank, Development Prospects Group. Historical US GDP deflator: US Department of Commerce. Global Commodity Markets World Bank Appendix B: Description of Price Series 31 Aluminum (LME) London Metal Exchange, unalloyed pri- moisture 8.0%; for year 2004, 67.40% Fe; 2000-03, mary ingots, high grade, minimum 99.7% purity, set- 67.55% Fe, moisture 7.6 - 8.0 %; contract price to tlement price beginning 2005; previously cash price Europe, f.o.b. Ponta da Madeira. Unit dry metric Bananas (Central & South America), major brands, ton unit (dmtu) stands for mt 1% Fe-unit. To con- c.i.f. Hamburg vert price in cents/dmtu to $/dmt SSF (dry ore), Bananas (Central & South America), major brands, US multiply by percent Fe content. import price, free on truck (f.o.t.) US Gulf ports Lead (LME), refined, 99.97% purity, settlement price Barley (Canada), feed, Western No. 1, Winnipeg Com- Logs (Malaysia), meranti, Sarawak, sale price charged modity Exchange, spot, wholesale farmers’ price by importers, Tokyo beginning February 1993; pre- Coal (Australia), thermal, f.o.b. piers, Newcastle/Port viously average of Sabah and Sarawak weighted by Kembla, 6,300 kcal/kg (11,340 btu/lb), less than Japanese import volumes 0.8%, sulfur 13% ash beginning January 2002; previ- Logs (West Africa), sapele, high quality (loyal and ously 6,667 kcal/kg (12,000 btu/lb), less than 1.0% marchand), 80 centimeter or more, f.o.b. Douala, sulfur, 14% ash Cameroon beginning January 1996; previously of Cocoa (ICCO), International Cocoa Organization daily unspecified dimension price, average of the first three positions on the Maize (US), no. 2, yellow, f.o.b. US Gulf ports terminal markets of New York and London, nearest Meat, beef (Australia/New Zealand), chucks and cow three future trading months forequarters, frozen boneless, 85% chemical lean, Coconut oil (Philippines/Indonesia), bulk, c.i.f. Rotter- c.i.f. US port (East Coast), ex-dock, beginning No- dam vember 2002; previously cow forequarters Coffee (ICO), International Coffee Organization indica- Meat, chicken (US), broiler/fryer, whole birds, 2-1/2 tor price, other mild Arabicas, average New York to 3 pounds, USDA grade “A”, ice-packed, Georgia and Bremen/Hamburg markets, ex-dock Dock preliminary weighted average, wholesale Coffee (ICO), International Coffee Organization indi- Meat, sheep (New Zealand), frozen whole carcasses cator price, Robustas, average New York and Le Prime Medium (PM) wholesale, Smithfield, Lon- Havre/Marseilles markets, ex-dock don beginning January 2006; previously Prime Copper (LME), grade A, minimum 99.9935% purity, Light (PL) cathodes and wire bar shapes, settlement price Natural Gas (Europe), average import border price ex- Copra (Philippines/Indonesia), bulk, c.i.f. N.W. Europe cluding UK beginning June 2000; previously includ- Cotton (Cotton Outlook “CotlookA index”), middling ing UK 1-3/32 inch, traded in Far East, c.&f. beginning Natural Gas (US), spot price at Henry Hub, Louisiana 2006; previously Northern Europe, c.i.f. Natural Gas Index, composite index weighted by con- Cotton Cotton (US), Memphis/Easter, middling 1-3/32 sumption volumes for Europe, US and Japan lique- inch, c. & f. Far East beginning October 2008; previ- fied natural gas (LNG) ously c.i.f. Northern Europe Natural gas LNG (Japan), import price, cif, recent two Crude oil, average spot price of Brent, Dubai and West months’ averages are estimates Texas Intermediate, equally weighed Nickel (LME), cathodes, minimum 99.8% purity, settle- Crude oil, Dubai Fateh 32° API, f.o.b. Dubai, spot price ment price beginning 2005; previously cash price Crude oil, UK Brent 38° API, f.o.b. UK ports, spot price Oranges (Mediterranean exporters) navel, EEC indica- Crude oil, West Texas Intermediate (WTI) 40° API, tive import price, c.i.f. Paris f.o.b. Midland Texas, spot price Palm oil (Malaysia), 5% bulk, c.i.f. N. W. Europe DAP (diammonium phosphate), standard size, bulk, Palmkernel Oil (Malaysia), c.i.f. Rotterdam spot, f.o.b. US Gulf Phosphate rock (Morocco), 70% BPL, contract, f.a.s. Fishmeal (any origin), 64-65%, c.&f. Bremen, estimates Casablanca based on wholesale price, beginning 2004; previ- Plywood (Africa and Southeast Asia), Lauan, 3-ply, ex- ously c.&f. Hamburg tra, 91 cm x 182 cm x 4 mm, wholesale price, spot Gold (UK), 99.5% fine, London afternoon fixing, aver- Tokyo age of daily rates Potassium chloride (muriate of potash), standard grade, Groundnut oil (any origin), c.i.f. Rotterdam spot, f.o.b. Vancouver Iron ore (Brazil), Companhia Vale do Rio Doce (Vale, Rice (Thailand), 5% broken, white rice (WR), milled, formerly CVRD) Carajas sinter feed, for years 2005- indicative price based on weekly surveys of export 09, 67.50% Fe (iron) content (dry weight) ores, transactions, government standard, f.o.b. Bangkok Global Commodity Markets World Bank 32 Appendix B: Description of Price Series Rice (Thailand), 25% broken, WR, milled indicative daily price, raw, f.o.b. and stowed at greater Carib- survey price, government standard, f.o.b. Bangkok bean ports Rice (Thailand), 100% broken, A.1 Super beginning Tea (Colombo auctions), Sri Lankan origin, all tea, 2006, broken kernel obtained from the milling of arithmetic average of weekly quotes. WR 15%, 20%, and 25%, government standard, Tea (Kolkata auctions), leaf, include excise duty, arith- f.o.b. Bangkok; previously A.1 Special metic average of weekly quotes. Rubber (any origin), Ribbed Smoked Sheet (RSS) no. Tea (Mombasa/Nairobi auctions), African origin, all 1, in bales, Rubber Traders Association (RTA), spot, tea, arithmetic average of weekly quotes. New York Tea, average three auctions, arithmetic average of quo- Rubber (Asia), RSS3 grade, Singapore Commodity Ex- tations at Kolkata, Colombo and Mombasa/Nairobi. change Ltd (SICOM) nearby contract beginning Tin (LME), refined, 99.85% purity, settlement price 2004; during 2000 to 2003, Singapore RSS1; previ- TSP (triple superphosphate), up to September 2006 ously Malaysia RSS1 bulk, spot, f.o.b. US Gulf; from October 2006 on- Sawnwood (Cameroon), sapele, width 6 inches or wards Tunisian, granular, f.o.b. more, length 6 feet or more, f.a.s. Cameroonian Urea, (Black Sea), bulk, spot, f.o.b. Black Sea (pri- ports marily Yuzhnyy) beginning July 1991; for 1985-91 Sawnwood (Malaysia), dark red seraya/meranti, select (June) f.o.b. Eastern Europe and better quality, average 7 to 8 inches; length av- Wheat (Canada), no. 1, Western Red Spring (CWRS), in erage 12 to 14 inches; thickness 1 to 2 inch(es); kiln store, St. Lawrence, export price dry, c. & f. UK ports, with 5% agents commission Wheat (US), no. 1, hard red winter, ordinary pro- including premium for products of certified sustain- tein, export price delivered at the US Gulf port for able forest beginning January 2005; previously ex- prompt or 30 days shipment cluding the premium Wheat (US), no. 2, soft red winter, export price de- Shrimp (Mexico), west coast, frozen, white, No. 1, shell- livered at the US Gulf port for prompt or 30 days on, headless, 26 to 30 count per pound, wholesale shipment price at New York Woodpulp (Sweden), softwood, sulphate, bleached, air- Silver (Handy & Harman), 99.9% grade refined, New dry weight, c.i.f. North Sea ports York Zinc (LME), high grade, minimum 99.95% purity, settle- Sorghum (US), no. 2 milo yellow, f.o.b. US Gulf ports ment price beginning April 1990; previously special Soybean meal (any origin), Argentine 45/46% extrac- high grade, minimum 99.995%, cash prices tion, c.i.f. Rotterdam beginning 1990; previously US 44% Soybean oil (any origin), crude, f.o.b. ex-mill Soybeans (US), c.i.f. Rotterdam Steel products price index, 2000=100, (Japanese), com- posite price index for eight selected steel prod- ucts based on quotations f.o.b. Japan excluding shipments to the US, including China after 2002, weighted by product shares of apparent combined consumption (volume of deliveries) at Germany, Japan and the United States. The eight products are as follow: rebar (concrete reinforcing bars), merch bar (merchant bars), wire rod, section (H-shape), plate (medium), hot rolled coil/sheet, cold rolled coil/sheet and galvanized iron sheet for building which replaced galvanized sheet for appliances. Sugar (EU), European Union negotiated import price for raw unpackaged sugar from African, Caribbean and Pacific (ACP) under Lome Conventions, c.i.f. European ports Sugar (US), import price, nearest future, c.i.f. New York Sugar (world), International Sugar Agreement (ISA) Global Commodity Markets World Bank Appendix C: Definitions and Explanations 33 Commodity Composition of Indices. Composition of the sub-indices is as follows: Beverages: cocoa, coffee (arabica and robusta), tea; Cereals: barley, maize, rice, wheat; Edible oils: coconut oil, groundnut oil, palm oil, soybean meal, soybean oil, soybeans; Other food: bananas, meat (beef and chicken), or- anges, shrimp, sugar; Raw materials: cotton, rubber, timber (tropical hardwood logs and sawnwood); Fertilizers: DAP, phosphate rock, potassium chlo- ride, TSP, urea; Metals: aluminum, copper, iron ore, lead, nickel, tin, zinc. Constant prices are prices which are deflated by the Manufactures Unit Value Indices (MUV), with a base of 2000=100. The MUV is the unit value index in US dollar terms of manufactures exported from the G-5 countries (France, Germany, Japan, UK, and US), weighted proportionally to the countries’ exports to the developing countries. Dollars are US dollars unless otherwise specified Index Weights. Energy consists of crude oil [84.6%], natural gas [10.8%], and coal [4.6%]. Non-energy consists of metals [31.6%], fertilizers [3.6%], and agriculture [64.8%]. Agriculture consists of bever- ages [8.4%], raw materials [16.5%], and food [39.9%] while Food consists of cereals [11.2%], edible oils [16.3%], and other food [12.4%]. Price Indices were computed by the Laspeyres formu- la. The Energy Price Index is comprised of 3 com- modities; the Non-Energy Price Index is comprised of 34 commodities. U.S. dollar prices of each com- modity are weighted by 2002-04 average develop- ing countries’ export values. Base year reference for all indexes is 2000. Countries comprised of all low and middle income economies according to World Bank income classification. Reporting period. Calendar vs. crop or marketing year refers to the span of the year. It is common in many agricultural commodities to refer to production and other variables over the twelve month period which begins with harvest. A crop or marketing year will often differ by commodity and, in some cases, by country or region. Commodities such as metals use calendar year. Tons refer to metric tons (1,000 kilograms) Global Commodity Markets World Bank 34 Appendix D: Acronyms and Abbreviations ACP African, Caribbean, and Pacific (Lome Convention) kg kilogram API American Petroleum Institute lb pound bbl barrel LME London Metal Exchange BP British Petroleum LNG Liquefied Natural Gas BPL Bone phosphate of lime mb/d million barrels per day CBGA Central Bank Gold Agreement mmbtu million of British thermal units c.i.f. cost, insurance, and freight mt metric ton CIS Commonwealth of Independent States MUV Manufactures unit value CWRS Canada Western Red Spring n.a. data not available DAP Diammonium Phosphate n.q. no quotation c.& f. cost and freight OECD Organization for Economic Cooperation and cum cubic meter Development dmtu dry metric ton unit OPEC Organization of Petroleum Exporting Countries EEC European Economic Community PNG Papua New Guinea EU European Union RSS1 Ribbed Smoked Sheet [grade 1] f.a.s. Free alongside (steamer/ship) RTT Rubber Traders Association f.o.b. free on board SGP Singapore f.o.r. free on rail SICOM Singapore Commodity Exchange f.o.t. free on truck SRW Soft Red Winter fe iron SSF Standard Sinter Feed FSU Former Soviet Union toz troy oz G-5 France, Germany, Japan, United Kingdom, and TSP Triple Superphosphate United States UAE United Arab Emirates GDP Gross domestic product UN United Nations HRW Hard Red Winter US DOE US Department of Energy ICAC International Cotton Advisory Committee USDA US Department of Agriculture ICCO International Cocoa Organization Vale Companhia Vale do Rio Doce ICO International Coffee Organization WBMS World Bureau of Metal Statistics IEA International Energy Agency WFP World Food Programme IRSG International Rubber Study Group WR white rice ISA International Sugar Agreement WTI West Texas Intermediate ITC International Tea Committee $ US dollar ITTO International Tropical Timber Organization ¢ US cent kcal kilogram-calorie Global Commodity Markets World Bank THE WORLD BANK For more information on the analysis, please see 1818 H Street, NW www.worldbank.org/prospects/Prospects for the Washington, DC 20433 USA Global Economy/Commodity markets Telephone: 202 477-1234 Facsimile: 202 477-6391 Internet: www.worldbank.org E-mail: GCM@worldbank.org Global Commodity Markets World Bank