Global coronavirus lockdowns and uncertainty have forced global trade dislocations and Pakistan must now find new markets for its exportable agricultural products, including meat, fruit, vegetables and rice.
Disrupted agricultural production, global food supply chains and radical shifts in consumer demand followed by historic employment shifts have reduced the FAO food price index to a 17-month low. The FAO food price index is a measure of the monthly change in international prices of a basket of food commodities.
According to an AKD Securities report, urea prices also receded in May. Cotton prices underwent minor changes despite being burdened by weak fundamentals, such as reduced demand, transport and labour issues.
The global situation is also weaker as economic activity took a backseat following unprecedented lockdowns to restrict the spread of COVID-19.
Intermittent lockdowns are expected to impact global growth over the medium term and reports of a second wave and infection peak have increased uncertainty.
Energy commodity prices increased up by 57 to 60% month on month due to OPEC and members complying with agreed cuts. Coal increased by 13% but the average price is still down. This increase in the price of energy commodities will have a negative impact on Pakistan.