This blog post is part of a special series based on the October 2024 Commodity Markets Outlook, a flagship report published by the World Bank. This series features concise summaries of commodity-specific sections extracted from the report.
Food commodity prices retreated in November—led by wheat and soybeans—losing most of the gains made during September-October. The World Bank’s food price index fell by about 3 percent (q/q) in the third quarter of 2024, reaching a level 8 percent lower than a year earlier. Grain prices fell by 6 percent in 2024Q3, pushing them to a level 15 percent lower than the same period a year earlier. After declining by an estimated 4 percent in 2025 (following a 9 percent decline in 2024), the index is expected to stabilize in 2026.
Grain and edible oil supplies grew by 47 and 6.5 million metric tons, respectively, in the 2023-24 crop season, remarkably close to their three-decade averages. In the 2024-25 crop season, which began in the summer of 2024, supply growth is expected to be limited for grains and slightly below the long-term average for edible oils. Maize and wheat supplies during the ongoing season are projected to be little changed from last season. In contrast, soybean and rice supplies are forecast to reach record highs.
Food commodity inventories are steadily declining but remain higher than historical norms. The aggregate stock-to-use (S/U) ratio for food commodities, a key indicator of supply availability relative to demand, is expected to fall to 26 percent in 2024-25—down from over 30 percent between 2017 and 2020. The tightening of inventories could make prices more sensitive to potential shocks, such as adverse weather in major exporting countries, as seen in September and October of this year. However, current inventories are significantly higher than during the price spikes of 2007 and 2011, when the S/U ratio dropped to lows of 17 and 20 percent, respectively.
Food prices are expected to ease by 13 percent between 2024 and 2026. Following a projected 9 percent decline in 2024, the World Bank’s food price index is expected to decline by an additional 4 percent in 2025 before stabilizing in 2026. This trend is expected to be similar among the two main sub-indexes—grains and oils and meals. However, the outlook is subject to several risks. On the upside, these include extreme weather events, higher biofuel mandates, and increased geopolitical tensions. On the downside, lower-than-expected energy prices could drive food prices down further.
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