The World Bank is projecting global commodity prices will fall in 2025 and 2026, with tariffs helping to weigh on corn, wheat, and soybeans.
Released Tuesday, the World Bank’s latest Commodity Markets Outlook forecasts a 12% fall in world commodity prices in 2025, followed by a further 5% decline in 2026. Meanwhile, food prices are also expected to recede, falling by 7% in 2025 and an additional 1% next year.
All three components of the World Bank’s Food Price index are expected to decline in 2025, the report said, with grains down 11%, and oils and meals, and other foods, by 7% and 5%, respectively.
Corn prices are forecast to edge down by 2% in both 2025 and 2026, weighed down by lower crude oil prices, which reduce demand for ethanol, and “increased tariffs on U.S.-China trade,” the report said.
Soybean prices are projected to tumble by 17% in 2025, as global production is expected to rise by 6% to a new record in the 2024- 25 season, with the stocks-to-use ratio climbing close to its 2018-19 record high. Weaker imports of U.S. soybeans in China, amid heightened trade tensions, are expected to weigh on the U.S. benchmark price.
Wheat prices are forecast to edge slightly in 2025-26, as downward demand pressure related to trade tensions is partially offset by tight supply conditions. Near-record wheat production is expected to be narrowly outpaced by consumption, resulting in a decline in global stocks, the report said.
In nominal terms, overall world commodity prices for 2025 and 2026 would still be higher than they were before the start of the pandemic, the report said. Adjusted for inflation, however, they are likely to fall for the first time below the average that prevailed from 2015 through 2019. That would mark the end of a boom fueled by the global economy’s rebound from the COVID-19 pandemic and Russia’s invasion of Ukraine in 2022, it added.
“It remains to be seen whether this marks the beginning of a more turbulent era for commodity markets. But the confluence of trade tensions, conflicts, geopolitical risks, and frequent weather-related shocks makes it more likely.”
Energy prices are expected to see one of the sharpest declines, falling by an estimated 17% this year to the lowest level in five years before dropping an additional 6% in 2026. Prices of Brent crude oil are forecast to average just $64 a barrel in 2025 — a decline of $17 from 2024 — and just $60 in 2026. Coal prices are expected to drop by 27% this year and fall 5% in 2026, as the growth of coal consumption for power generation in developing economies slows.
On the other hand, the average price of gold — a popular choice for investors seeking “safe haven”— is expected to set a new record this year before stabilizing in 2026. Over the next two years, gold prices are expected to remain about 150% higher than the average in the five years preceding the COVID-19 pandemic.
