What is the World Bank's projection for global commodity prices in 2024, and what is the primary driver behind this surge?

The World Bank projects its commodity-price index will climb about 16% in 2024 — the first annual increase since Russia’s invasion of Ukraine — driven primarily by the war in Iran, which has disrupted key industrial supplies like oil and metals. The effective shutdown of the Strait of Hormuz, previously accounting for about a third of global seaborne crude oil trade, triggered a historic shock to energy and commodity markets, leading to surging energy and fertilizer prices.

According to the World Bank, how might rising fertilizer prices affect food security, and who is most vulnerable?

The World Bank sees fertilizer costs climbing 31% in 2024, posing risks to farmer incomes and future crop yields, which could eventually raise food costs and worsen food insecurity. The closure of the Strait of Hormuz has cut off key import routes for food-reliant economies, while higher fuel and freight costs push up prices for essentials; if oil prices remain above $100 a barrel, it 'could push up to 45 million more people into acute food insecurity this year.' As stated by Chief Economist Indermit Gill, 'the poorest people, who spend the highest share of their income on food and fuels, will be hit the hardest,' underscoring that 'war is development in reverse.'

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The World Bank predicts global commodity prices will rise 16% this year due to Iran war disruptions to oil and metals. Fertilizer costs are projected to jump 31%, potentially pushing 45 million more people into acute food insecurity.

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