Prices Of Precious Metals Dropped 0.6%, Fertilize Up By 96.7%

Global commodity prices registered mixed performance in Q1’2022, with prices of precious metals declining by 0.6 percent largely driven by reduced demand for safe-haven assets in Q1’2022, as compared to a similar period last year.

Fertilizer prices recorded the highest increase, gaining 96.7 percent in Q1’2022, mainly attributable to a mismatch between demand and supply arising from supply chain constraints.

This was a result of the Russian government’s decision to halt fertilizer exports in a retaliatory move following sanctions for their role in the Russia – Ukraine conflict. Key to note, Russia is the single largest producer of fertilizers.

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Here is the World Bank Commodity Price Index:

In Kenya, the prices of fertilizers had risen beyond manageable levels. A bag had hit 7,400 shillings from 2,400 shillings and there were fears that the farmers will not be able to plant this season. With delays in the rains, the harvests this year might be terrible.

The government has already announced that it will release funds for the subsidy of the fertilizer though farmers feel it is an initiative that has come too late. They also feel cartels will hide the fertilizer as a result in order to influence the prices.

Read More: Here Is A List Of Commodities Whose Prices Have Increased

At the same time, the world economy is projected to register slower growth in 2022 than earlier envisaged, with the International Monetary Fund (IMF) projecting a 4.4 percent growth in 2022 down from the initial projection of a 4.9 percent growth.

The downward revision was mainly attributable to the continued presence and effects of the Omicron COVID-19 variant coupled with supply chain disruptions that continued to hinder global manufacturing growth.

Advanced Economies are projected to expand by 3.9 percent while Developing and Emerging Markets are projected to expand by 4.8 percent in 2022.