The National, Thursday October 22nd, 2015
COMMODITY prices in the global market fell by 16 per cent in the September quarter, and by 10 per cent over the year, according to the BSP Economic and Market insight report for last month.
The report highlighted the driven factor of the decrease.
“The decrease was driven by price drops in energy, especially from crude oil, due to sustained oil production and financial market volatility.
“Growth concerns and financial market volatility in emerging markets, especially China, has impacted commodities over the quarter,” the report said.
“Agricultural prices decreased by 6 per cent in the September quarter and by 11 per cent over the year.
“Palm oil prices declined by 25 per cent year to date owing to weak import demand, mainly from India and China.”
The report said crude oil prices fell by 28 per cent over the September quarter, averaging $51.28 per barrel of oil, due to strong OPEC (Organisation of Petroleum Exporting Countries) production and possible suspension of sanctions against Iran.
“A recent IMF study suggest that a weak commodity price outlook is estimated to subtract almost 1 per cent annually from the average rate of economic growth in commodity exporters over 2015-17 compared with 2012-14.”
The report said commodity prices were expected to remain low given the ample supplies and weak prospects for global economic growth.