(Bloomberg) -- Fragmented commodities markets, mainly driven by Russia’s invasion of Ukraine, threaten food security and risk raising the price of cleaner energy, the International Monetary Fund warned.

Minerals critical for the green transition, including cobalt, lithium and copper, as well as highly-traded agricultural products such as wheat are especially vulnerable to “geo-economic fragmentation,” the IMF said Tuesday, referring to a rising trend of policy-driven reversals of integration.

Russia’s invasion of Ukraine in 2022 and Western sanctions have disrupted global markets for food, fuel and fertilizer, keeping prices elevated and exacerbating inflation pressures. Meanwhile, the US has been seeking new trade partnerships focused on so-called critical minerals, which are necessary for green technology, as concern grows over China’s dominant supply position.

“Commodity market fragmentation could create a more unstable global environment, posting threats to food security, economic growth, and the cost of climate change mitigation efforts,” the IMF said in a portion of its upcoming World Economic Outlook. “Our findings present yet another argument for multilateral cooperation on trade policies to prevent such outcomes.”

While overall global growth would take a mild hit, low-income and other vulnerable countries could see an average long-term drag on growth of 1.2%, mainly because of the impact on agricultural imports. Losses for some countries could go as deep as 2%.

In the absence of multilateral guardrails, the IMF suggested the creation of “green corridor” agreements — to safeguard the flow of minerals needed for decarbonization — and food corridor deals — to ensure equal access across all countries and national incomes. 

©2023 Bloomberg L.P.