High-price environment of commodities likely to stay: WTO

Prices for food, energy, metals and minerals roughly doubled since 2000. Although prices have eased back from these historical highs, strong demand from large developing countries provides a strong reason to believe that the high-price environment is likely to stay, according to a report by World Trade Organisation(WTO).

The challenges and opportunities arising from high prices differ significantly across countries. In many developing countries the agricultural sector is important in terms of employment, production and consumption. This suggests an important role for agriculture in development strategies in the developing world. But higher prices pose challenges for net importers of these goods.

Developing countries increased their market share in global agricultural exports from 27 to 36 per cent since 2000. But traditional market access barriers such as tariffs and subsidies continue to affect their exports and non-tariff measures are playing an increasingly important role.
Trade in natural resources has also grown strongly, not only in value terms but also in terms of volume. Several resource-rich countries have achieved high growth as a result, but the social and environmental impacts of natural resource extraction as well as economic diversification remain significant challenges.

The World Trade Report 2014 identifies these four trends as:the rise of the developing world; the expansion of global value chains;the higher prices of commodities; and the increasingly global nature of macroeconomic shocks.
Source: Commodity Online