Global commodity markets are bracing for their steepest decline in six years, with prices projected to drop sharply through 2026. According to the latest forecasts, weak global economic growth, expanding oil supplies, and ongoing policy uncertainty will continue to weigh on markets.
Consecutive Declines Signal Weakening Demand
Commodity prices are expected to fall by 7% in both 2025 and 2026. This would mark the fourth consecutive year of decline, signaling persistent pressure on the global economy. Despite the downward trend, prices are still projected to remain above pre-pandemic levels — 23% higher in 2025 and 14% higher in 2026 compared to 2019.
The report highlights that falling energy and food costs have helped reduce global inflation, making essentials like rice and wheat more affordable for developing economies. However, the slowdown in industrial demand continues to drag overall market performance.
Oil Surplus Expands as Demand Stalls
Energy prices are facing a sharp contraction as oil supplies rise and consumption growth slows. The global oil glut has expanded significantly in 2025 and is expected to surge further next year, climbing 65% above its previous peak in 2020.
Brent crude oil prices are forecast to decline from an average of $68 per barrel in 2025 to $60 in 2026 — a five-year low. Overall, energy prices could fall by 12% in 2025 and another 10% in 2026, driven largely by the growing popularity of electric and hybrid vehicles and stagnating demand in China.
Food Prices Ease but Fertiliser Costs Surge
Food commodities are showing a mixed trend. Prices are projected to decrease by 6.1% in 2025 and 0.3% in 2026. Soybean prices have dropped due to record harvests and trade tensions, while coffee and cocoa prices are expected to fall as global supply improves.
In contrast, fertiliser prices are projected to rise sharply by 21% in 2025 due to higher production costs and trade restrictions before easing by 5% in 2026. These spikes could erode farmers’ profits and raise concerns about agricultural productivity in the coming years.
Precious Metals Defy the Trend
While most commodities face declines, precious metals continue to shine. Gold prices are expected to climb 42% in 2025 and a further 5% in 2026 as investors seek safe-haven assets amid global uncertainty. Silver is forecast to rise by 34% this year and another 8% next year, reaching record annual averages.
These gains reflect growing demand from both central banks and investors hedging against inflation and geopolitical risks.
Risks That Could Alter the Forecast
The downward trajectory of commodities could deepen if global growth remains sluggish and trade tensions persist. Increased oil production from OPEC members could further flood the market and push prices lower.
However, the opposite scenario remains possible. Escalating geopolitical conflicts or new sanctions could tighten oil supply, lifting energy prices and boosting demand for safe-haven assets like gold.
Extreme weather linked to a stronger La Niña cycle may also disrupt agriculture, driving up food and energy costs. Additionally, the rapid growth of artificial intelligence and data centers could increase electricity use and demand for key industrial metals such as copper and aluminum.
Building Resilience Through Market-Based Solutions
To manage future volatility, the report advises countries to avoid price-control measures and instead focus on strengthening market resilience. It recommends diversifying production, investing in innovation, improving data transparency, and promoting market-based pricing systems.
Such long-term strategies, it notes, will help economies withstand future price shocks while ensuring stable growth in an increasingly unpredictable global market.
