PricePedia Scenario for December 2024

The PricePedia Scenario has been updated with information available as of December 9, 2024. The dynamics of global industrial production, representative of commodity demand, confirm a phase of weakness. In 2024, it shows modest growth of +1.1% compared to 2023. Expectations for an improvement in the economic outlook are projected for 2025, with growth slightly exceeding +2%, and especially in 2026, when the annual growth rate is expected to exceed +4.8%. This trend aligns with the broader effects of the monetary policy easing implemented by, among others, the European Central Bank (which further reduced interest rates by 25 basis points last week) and the U.S. Federal Reserve (see the weekly update on financial commodities Russian sanctions: from metals to energy?).

The following graph shows the dynamics of the global industrial cycle index^[1], which reflects the trends in industrial production.

Global Industrial Cycle, December 2024 Scenario

On average, the index is expected to show a contained negative variation of -0.5% in 2024, consistent with the previous scenario (see PricePedia Scenario for November 2024). In 2025, the cycle is characterized by a growth trend, although the annual average index is expected to remain stable compared to the previous year's values. A generally positive trend is forecast starting in 2026.

Forecast for Procurement Material Prices

The reversal of the global industrial cycle trend in 2025 primarily impacts the price trends of industrial commodities over the next two years.

The table below illustrates the annual price changes in euros for the main commodity aggregates (Industrial^[2], Total Commodities^[3], Total Energy, and Total Food).

Table 2: Annual Growth Rates (%) of PricePedia Aggregates Indices, in Euros

Overall, the Commodity index is expected to close 2024 with a reduction of -4.1%. The downward trend is expected to lose intensity during the 2025-2026 biennium.
However, when considering the individual components of the Commodity index, a distinction can be made between a slightly upward trend for industrial commodities prices and a downward trend for energy commodities prices.
Industrial commodities are projected to decline by nearly -4% in 2024, with growth of +3.3% anticipated in 2025. Conversely, energy commodity prices are expected to decrease by approximately -3% over the next two years.

A somewhat different trend characterizes food commodities. The average annual euro prices for 2024 are projected to increase by +2.7%. This dynamic will intensify in 2025 due to rising prices of tropical food commodities observed at the end of 2024, as shown in the table below.

Table 2: Annual Growth Rates (%) of PricePedia Food Aggregates, in Euros

In 2024, price increases are expected for the tropical and oils and fats families, with annual growth rates of +37.5% and +11.9%, respectively. A similarly strong increase is expected for tropical commodities in 2025 due to supply deficit concerns related to cocoa and coffee. Conversely, the oils and fats family is projected to decline by -8% in 2025.
As for other food commodity families in euros, 2024 is expected to close with a double-digit rate of reduction. In 2025, price differentiation is forecast: cereal prices will rise, while soybean and glucose prices are expected to decline.