According to AFEX, the price of energy will fall by 5% in 2024 and then by an additional 0.7% in 2025, while the price of agricultural commodities is expected to fall by 2% in 2024 and 3% in 2025. They are dependent on the Middle East’s conflicts defusing.
The AFEX 2024 Commodities Outlook Report, which was released in Lagos yesterday, contained these details. Additionally, it predicts a steady increase in domestic commodity prices until 2024.
Global commodity prices are expected to trend lower in 2024 as a result of things like increased supply and the expiration of several trade agreements.
According to the research, many factors could have a substantial impact on the trend’s direction and could potentially pose a downside or upside risk to commodity prices.
The article went on to say that important export goods like sorghum and cocoa are expected to rise by 20% and 50%, respectively, due to decreased output.
Despite a projected 4% growth in paddy rice output, other important commodities for consumption, such as maize and paddy rice, are expected to climb by 25% and 40%, respectively.
However, to reduce market volatility and guarantee food security, AFEX said that it was imperative to increase domestic agricultural output, simplify trade regulations, and create strategic reserves.
According to the paper, economic changes and inflation had a knock-on effect on the Nigerian commodities market. Global shocks including energy scarcity, geopolitical tensions, financial crises, and more, the research said, were causing turmoil in the commodities market.
Oluwafunto Olasemo, Vice President, Financial Markets, at AFEX, spoke at the event and stated that the perspective was a crucial aspect of the commodities market that determined trading patterns and movements among participants in both the physical and secondary markets.
According to her, a complicated balance between geopolitical, economic, and environmental issues will affect the commodities market this year. This will necessitate ongoing monitoring and strategic adaptation on the one hand, and increased vigilance on the part of policymakers and market stakeholders on the other.
