News Agribusiness
World Bank expects falling agricultural prices
The World Bank predicts a calmer commodity market in 2026, with lower prices for both agricultural and energy products. The sharp peaks of 2022 and 2023 are over, but the new reality is one of narrow margins and geopolitical risks.
The World Bank predicts agricultural commodity and energy prices will decline in 2026 in its Commodity Markets Outlook report. The institution expects agricultural commodity prices to stabilize this year, followed by a 2% decline in 2026 and a 1% decline in 2027.
The World Bank expects continued high prices for beef and poultry. This year's price increase for these meats amounts to approximately 14 to 15%. For the next two years, the institute anticipates an annual price increase of 0,6% for poultry. According to this forecast, beef prices will increase by 0,9 to 1,3%.
Sugar continues to fall in price
Sugar cannot yet exit the difficult period of price reductions due to strong production in Brazil and a sugar surplus in 2025-2026. However, the World Bank expects lower reductions (2,6%) next year and a stabilization in 2027. This year, the sugar price is about 15% below its 2024 level.
The decline in wheat prices is coming to an end. The World Bank expects a 7% decline this year, but over the next two years, the price is projected to rise by approximately 4% annually. The institute also assumes that wheat production will increase less than consumption. However, the International Grain Council (IGC) believes that production growth will outpace consumption.
Falling fertilizer prices
According to the latest estimates, fertilizer prices are around 30% higher in the third quarter of this year than last year. Lower yields will depress fertilizer use in some parts of the world next year. This, in turn, will lead to somewhat lower yields next year. The World Bank expects fertilizer prices to fall over the next two years, without taking into account the introduction of the carbon tax on imported fertilizers in the EU. The new carbon tax increases ammonia and urea by 10 to 20%.
Because of this levy, it's questionable whether farmers will benefit both ways: from lower yields and lower input costs. For now, it looks more likely that margins will become even tighter.
John Ramaker
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