Declining importance of primary commodities

The prices of oil and many primary commodities have slipped.

Table 1 Monthly indices of market prices of selected primary commodities

The new list contains about 600 primary and transformed commodities mainly derived from about 2,020 commodities in the Harmonized System.

The declining importance of primary commodities in world trade appears to foreshadow a continuation of the long term erosion in the prices of primary commodities relative to those of manufactured goods.

Producers of primary commodities often suffer from the low prices paid to them.

29. The major markets for most primary commodities remained the developed countries, which account for about 70 per cent of global world imports of commodities.

The prices of primary commodities had declined against the prices of manufactures, especially during the 1980s.

Improved market access for primary commodities, especially in their processed forms, should be provided, particularly by developed countries.

Also, both the product mix and trade links of African countries maintained the traditional bias towards primary commodities and northern markets.

The declining importance of primary commodities in world trade, combined with these countries loss of market share in world primary commodity markets, puts them in a weak position to benefit from globalization.

Africa s exports remain narrowly based on primary commodities, and little progress has been made in diversifying into non traditional exports, especially manufactures.

28. World trade in primary commodities has grown more slowly, and makes up a smaller share of total world trade than manufactured products.

Food commodities, 1996 Food commodities, 1997

The declining importance of primary commodities in world trade, combined with the loss of market share in world primary commodity markets suffered by those countries, puts them in a weak position to benefit from globalization.

32 In 2002, of 49 least developed countries, 31 were exporters of primary commodities and only 18 were exporters of manufactured goods or services.

Commodities, such as fuel, standard information technology equipment, office supplies and primary building products, are seen as examples of items appropriately procured by ERAs.

Not only has Africa remained commodity dependent, but it has fallen behind other developing regions of the world in exports of non fuel primary commodities.

(g) Distribution of monthly dry rations of food commodities to pregnant women, nursing mothers and tuberculosis patients receiving care at UNRWA primary health care facilities

The least developed countries needed to produce more exportable goods, including not merely primary commodities but also manufactured goods, and consequently they must foster diversification.

In the mid 1990s, primary commodities accounted for just over one fifth of total world trade, a decline from over 40 per cent in 1980.

29. Of particular concern to LDCs is the decline of official development assistance (ODA) and the prices of primary commodities on which they rely heavily.

Commodities

Commodities

Owing to their small size and limited resource endowments, those countries could not become major producers of primary commodities and therefore could not influence world market prices.

Precious commodities

(d) Commodities

and Commodities

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(c) Commodities

(c) Commodities

(c) Commodities

(c) Commodities

Research had shown that LDCs with an export specialization in primary commodities had significantly higher levels of poverty and were more likely to have unsustainable external debt burdens.

30. As the largest market for primary commodities, the developed countries are also the dominant suppliers of these products, accounting for over half of world exports of commodities in the mid 1990s, with North America accounting for about 15 per cent and Western Europe one third.

The poorest countries, especially those in sub Saharan Africa, need to move from subsistence to commercial agriculture, and from dependence on primary commodities to internationally competitive industries and services.

This makes the continuing deterioration in their terms of trade of special concern, even if there is some recent evidence of improvement in the prices of some primary commodities.

32. Export promotion policies in SSA have been largely confined to primary commodities, which have collectively proved vulnerable during the past 15 years to the fallacy of composition dilemma.

Not only do these industries have lower income elasticity in the international market but they are also subject to fluctuations in the demand and the prices of primary commodities.

55 183. Commodities

57 236. Commodities

58 204. Commodities

59 224. Commodities

61 190. Commodities

(d) Commodities (continued)