Connect with us

News

Most Commodity Prices to Drop in 2020 As Coronavirus Depresses Demand and Disrupts Supply

Avatar photo

Published

on

The global economic shock of the COVID-19 pandemic has driven most commodity prices down and is expected to result in substantially lower prices over 2020, the World Bank said in its April Commodity Markets Outlook.

Energy and metals commodities are the most affected by the sudden stop to economic activity and the serious global slowdown that is anticipated. Commodities associated with transportation, including oil, have experienced the steepest declines. Despite only moderate impact on the outlook for most agricultural commodities, supply chain disruptions and government steps to restrict exports or stockpile commodities raise concerns that food security may be at risk in places, the report says.

“In addition to the devastating human toll, the economic impact of the pandemic will dampen demand and cause supply disruptions, negatively affecting developing countries that rely heavily on commodities,” said Ceyla Pazarbasioglu, World Bank Group Vice President for Equitable Growth, Finance & Institutions. “Policymakers can take advantage of lower oil prices by undertaking energy-subsidy reforms to help free spending for urgent pandemic-related purposes. These reforms need to be complemented with stronger social safety nets to protect the most vulnerable segments of society. Policymakers must resist the urge to impose trade restrictions and actions that put food security at risk, as the poor would be hit the hardest.”

Monthly average crude oil prices plunged 50 percent between January and March. Prices reached an historic low in April with some benchmarks trading at negative levels. They are expected to average $35 per barrel in 2020, a sharp downward revision from the October forecast and a 43 percent drop from the 2019 average of $61 per barrel. The downward revision reflects an historically large drop in demand. The decline in crude oil prices has been exacerbated by uncertainty around production agreements among the Organization of the Petroleum Exporting Countries (OPEC) and other oil producers. Energy prices overall (which also include natural gas and coal) are expected to average 40 percent lower in 2020 but see a sizeable rebound in 2021.

Metal prices also fell in early 2020. The biggest declines were in copper and zinc, which are particularly associated with global economic activity. Metal prices are projected to drop 13 percent overall in 2020 as slowing demand and the shutdown of key industries weigh heavily on the market. Industrial metals would be affected the most by the global economic slowdown, in particular that of China, which accounts for more than half of global metals demand. 

Agriculture prices are less tied to economic growth, and saw only minor declines in the first quarter of 2020, except for rubber, which is used in transportation.  Prices are expected to remain broadly stable in 2020 overall as production levels and stocks of most staple foods are at record highs.  However, agricultural commodity production could face disruptions to the trade and distribution of inputs such as fertilizer, pesticides, and labor availability. Disruptions of supply chains have already affected emerging market and developing country exports of perishable products such as flowers, fruits, and vegetables.

This enormous shock to commodity markets and low oil prices could deliver a serious setback to developing economies and jeopardize the necessary investments in critical infrastructure that support long term growth and create quality jobs,” said Makhtar Diop, World Bank Vice President for Infrastructure. “The international community must rally together to address these setbacks by advancing interventions in diverse sources of energy, sustainable transport and access to digital infrastructure and services that allow people to stay connected during these uncertain times. This will be key to delivering vital social services, protecting jobs, supporting business and saving lives.”

An analytical focus examines the impact of the COVID-19 pandemic on commodity markets. Mitigation measures taken to control the virus have resulted in an unprecedented collapse in oil demand, and supply chain disruptions could cause dislocations in the consumption and production of other commodities and imperil food security. The pandemic has the potential to affect commodity demand and supply for an extended period, the analysis finds.

The plunge in oil prices provides policymakers in emerging market and developing economies with an opportunity to undertake energy-subsidy reforms. These reforms can help free spending for urgent pandemic-related purposes, discourage wasteful energy consumption, and reallocate spending to programs that better target the poor.

Another analytical section looks at OPEC in the context of other similar commodity supply management agreements. Such agreements have collapsed over time under pressure from economic forces and other events, and OPEC may be subject to the same pressures.

The World Bank Group, one of the largest sources of funding and knowledge for developing countries, is taking broad, fast action to help these countries strengthen their pandemic response. Over the next 15 months, the World Bank Group will be deploying up to $160 billion in financial support to help countries protect the poor and vulnerable, support businesses, and bolster economic recovery, including $50 billion of new IDA resources in grants or highly concessional terms. The Bank is also increasing disease surveillance, improving public health interventions, and helping the private sector continue to operate and sustain jobs. 

Continue Reading
Comments

Health & Wellness

Mushrooms emerge from the shadows in pesticide-free production push

Avatar photo

Published

on

By Ali Jones

Mention La Rioja in northern Spain and most people will picture majestic sun-drenched vineyards nestled in the hillsides. But, hidden from the sunlight, the region is also home to a very different crop that happens to be at the heart of efforts to make European food production more sustainable.

Three small villages in La Rioja house the vast, dark, humid growing sheds that produce its 77 000 tonnes of mushrooms each year. Almost half of Spain’s cultivated mushroom crop is grown in the region, making Spain the third-largest producer in Europe, behind Poland and the Netherlands.

New world

‘Mushrooms are a whole different world than we are used to, from growing plants or rearing animals,’ said Pablo Martínez, an agronomist who worked in wineries before being drawn to the specialist mushroom sector after a chance conversation with a former colleague.

Based at the Mushroom Technological Research Centre of La Rioja (CTICH), Martínez manages a Europe-wide project to tackle the environmental challenges faced by the industry.

Many people know very little about how mushrooms are grown. While it’s easy to buy a starter kit online to have a go at home, growing on a commercial scale is very different – managing humidity, temperature and light to produce a regular, quality crop while contending with pest control.

Cultivated mushrooms can double in size in a day and consumer demand for them is mushrooming too.

The global market is projected to grow from around 15 million tonnes in 2021 to more than 24 million tonnes over the next five years. Packed with nutrients, they deliver a protein-rich umami kick that is well suited to the soaring trend for plant-based foods.

To meet demand, growers need to fail-safe their crop from pests and, for now, they rely on pesticides. Tighter regulations are limiting available products and concerns over the impact on the environment and human health mean growers are looking to researchers to come up with answers.

CTICH is coordinating the BIOSCHAMP project, which works with researchers, commercial partners and mushroom growers in six European countries. In addition to Spain, they are Belgium, the Netherlands, Poland, Serbia and the UK.

Peatland protection

Mushrooms are grown on a substrate, or base layer, made of straw and animal manure, then covered with a thick blanket of peat known as the casing. Made up of partially decayed vegetation, peat perfectly mimics nature’s forest floors that so readily yield mushrooms.

The depletion of precious finite peatlands is a global concern. These wetlands store more carbon than all other vegetation types in the world combined and their conservation is ever more important for countering climate change.

‘Mounting restrictions on peat extraction in European countries threaten the long-term continuity of peat supplies,’ said Martínez. ‘We’re looking to develop a new product for growing mushrooms that could cut pesticide use by 90% while reducing the industry’s reliance on peat.’ 

Most of Europe’s peat comes from the Baltic countries, traveling first by boat to the Netherlands, where it is treated ready for commercial use, before being distributed to growers across Europe, amassing transport costs and a heavy carbon footprint.

BIOSCHAMP aims to create a low-peat sustainable casing for cultivated mushrooms made from renewable materials sourced close to existing mushroom production.

While the exact details are under wraps, it will combine with a substance known as a biostimulant to enhance the natural growing processes and strengthen the mushroom mycelium in their early phase, protecting them against disease without the need for chemical pesticides.

Fertile waste 

In Norway, two mushroom enthusiasts have pioneered a project to explore whether the crop could be cultivated in food waste. The EU-funded initiative is called VegWaMus CirCrop.

Dr Agnieszka Jasinska, who completed her postgraduate research on mushroom substrates, has led the research in partnership with Dr Ketil Stoknes, senior project leader of research and development at waste-management company Lindum and himself once a specialist mushroom grower.

The project has demonstrated that organic residue from food waste – usually used to feed anaerobic digestors, devised to capture methane and divert it from problematic greenhouse gas to useful fuel – can be a successful starter for mushrooms.

The European Food Information Council (EUFIC) estimates that a whopping one third of all food produced for human consumption is wasted. Anaerobic digestion, also known as biogas, allows the nutrients from waste to be reused for growing plants in greenhouses.

‘It enables a climate-efficient, resilient, urban food production system based entirely on waste,’ said Stoknes.

Tomatoes, lettuce and herbs had been chosen as the initial candidates. But Stoknes said that mushrooms are degraders, breaking down fibres and so on, and are a necessary part of an integrated biosystem. Inspired by the natural cycle in the forest, the project set out to combine mushrooms and plants in one circular system.

The biogas system is explained as ‘food to waste to food’ and it’s a movement that is growing in popularity.

While mushroom cultivation ceased on a commercial scale in Norway in the early 2000s, unable to compete with other countries, VegWaMus CirCrop has proved there could be a sustainable future for Norwegian mushroom production after all.

Side hustle

The project has hatched a start-up company called SOPPAS with ambitions to scale up the process commercially. In the meantime, it’s embarking on a raft of new ideas, including expanding production at the food waste biogas facility from button mushrooms to oyster mushrooms.

‘The new company will produce starter blocks for growing mushrooms for farmers, plant producers and greenhouse owners who might want to diversify to mushrooms in their low season,’ said Jasinska. ‘They can put their existing pickers, packing line and cold-storage facilities to good use in idle times and sell the produce locally.’

Against the backdrop of growing momentum for producing food from waste and an interest in keeping production local, both EU-funded projects look set to give mushrooms their moment in the sun.

Research in this article was funded via the EU’s Marie Skłodowska-Curie Actions (MSCA). ). This article was originally published in Horizon, the EU Research and Innovation Magazine.

Continue Reading

World News

Sergey Lavrov: ‘If you want peace, always be ready to defend yourself’

Avatar photo

Published

on

Russian Foreign Minister Sergey Lavrov gave an exclusive interview to Sputnik on Thursday, February 2. The conversation took place at a time of heightened international tensions over the conflict in Ukraine.

Mr. Lavrov has answered questions posed by the General Director of Rossiya Segodnya International News Agency, Dmitry Kiselev (photo), on the most pressing issues regarding Russian foreign policy and the international agenda.

Key statements made by Russia’s FM Sergei Lavrov in his interview to Sputnik:

Moscow did not turn to Collective Security Treaty Organization (CSTO) partners with a request for assistance in connection with the special operation in Ukraine. “We have not made such a request to anyone. We proceed from the fact that we have everything necessary to solve the tasks of the special military operation, to end the war that the West started through the Ukrainian regime even after the coup d’etat.”

It seems that the West will supply Kiev with modern military equipment together with foreign combat crews. “All types of weapons that have already been partially transferred, and especially those that have been announced, according to experts, it is impossible for Ukrainians to work on these systems, trained or having passed some two-month or even three-month courses. There are systems, according to specialists, that cannot be trained for in the foreseeable future, and if they are supplied, then most likely it will be done together with combat crews.”

The more long-range weapons are supplied to the Kiev regime by the West, the further they need to be moved away from Russian territory.

Russia wants the conflict with Ukraine to end, but the time factor is not the main issue.

The United States deprives nations of the right to remember their own history; their task is to melt everyone into “Americans”.

The US conviction of its own superiority and infallibility is the main reason for Russia’s current confrontation with the West.

The West is hoping for a strategic defeat for Russia so that it cannot recover for decades.

Nobody is trying to convince Kiev to return to negotiations with Moscow; Zelensky himself does not feel like an independent figure, he is being manipulated.

The presumption that Russia refuses to negotiate on Ukraine is a lie.

The West is now “eyeing” Moldova for the role of “next Ukraine”; its president is ready for almost anything.

The West, on an almost “daily” basis, forces developing countries, including those in Africa, to implement sanctions against Russia;

The ideas of different countries increasing trade in national currencies are emerging because of US actions, which violate all the boundaries of decency with the US dollar.

Relations between Russia and China are superior in quality to a military alliance; they have no restrictions, limits or taboo topics; China already began to reduce dependence on Western financial mechanisms.

Nuland made a confession, rejoicing at the explosions on the Nord Stream pipelines; her words reflect the direct participation of the United States in the terrorist attack.

The United States “crushed” the European Union under itself, depriving it of the last signs of independence.

Lavrov says he is for peace, follows philosophy ‘if you want peace, always be ready to defend yourself.’

Continue Reading

World News

More Americans believe US provides ‘too much support’ to Ukraine

Avatar photo

Published

on

A growing portion of Americans think that the U.S. is giving too much support to Ukraine, as the Biden administration and other western allies have taken steps in recent weeks to escalate their backing of the country in its war against Russia, notes ‘The Hill’.

About a quarter of Americans, 26 percent, think the U.S. support of Ukraine is ‘too strong’, according to a new Pew Research Center poll. It is a percentage of people that has steadily grown since the Russian invasion of Ukraine last year and has jumped 6 points since September.

The U.S. has sent billions of dollars to Ukraine to support its military in the war against Russia. In a $1.7 trillion spending package passed by Congress late last year, lawmakers included around $45 billion in funding for Ukraine and NATO allies. But the spending levels have come under attack by some Republican lawmakers, who argue the country is opening its pockets at unsustainable levels for Ukraine.

Then-House Minority Leader Kevin McCarthy (R-Calif.) said that House Republicans would not provide a “blank-check” for support of Ukraine if his party took control of the House — which it did. Rep. Lauren Boebert (R-Colo.) said on Twitter that President Biden needed to understand the U.S. wasn’t an ATM (automated teller machine).

And as some prominent Republicans have started to sour on the support levels, the poll of 5,152 people, with a margin of error of 1.7 percent, found that Republican voters are following along. A total of 40 percent of Republicans and Republican-leaning independents think the U.S. is providing ‘too much support’, according to the poll. That is up from 32 percent in September and from 9 percent in February 2022.

While Republican attitudes have dimmed on Ukrainian support, they have also come to view the Russian war as less of a major threat to the U.S.

Just 29 percent of Republicans and Republican-leaning independents think the war is a major threat.

In March 2022, Republicans were more likely to see the invasion as a direct threat to the U.S., but now Democrats are more likely to hold that opinion, with 43 percent holding that belief.

Continue Reading

Publications

Latest

Trending