Momentum builds to curb betting on hunger

Since we launched our campaign against food speculation nearly a year ago – then virtually an unknown issue – momentum has been steadily building towards regulation. We’ve had wide-ranging support, including from the British mainstream media, leading academics, former hedge fund managers, the UN special rapporteur on the right of food and the head of the Food and Agriculture Organisation. In January over 3,000 people made submissions to a European Commission consultation on the issue. Food speculation and the impact that it has on the world’s poorest people clearly resonates and we are confident that we can win this campaign. 

Now, following our month of action against Barclays – the UK’s largest food speculator – we are really pleased to see some of the bigger development charities joining in. Today, for example, a new report from Christian Aid (PDF) echoes our concerns about money flooding into commodity markets and pushing up food prices. Hungry for Justice: Fighting starvation in an age of plenty warns that:

In recent years, global financial markets seem to have also played a part in helping put food beyond the reach of those living in poverty. A market system that has turned crops into financial commodities is now suspected of acting in an unforeseen and damaging way by forcing up prices."

While it’s great to hear others speaking out about speculation on food commodities, the report is tentative in its conclusions and calls for more research. Yet as WDM’s reports show, there is plenty of evidence that speculation is causing spikes and hikes in food costs. Amid record prices, riots in Uganda and the risk of another full blown food crisis, we need to seize the current opportunity for new global rules curbing speculation.

At a recent event organised by peasant movement La Via Campesina, representatives shared their experiences of rising food prices. Henry Saragih from the Indonesia Farmers Union said that speculation had encouraged rice sellers to hoard their stocks, further pushing up prices.  Yoon Geum Soon from the Korean Women Peasant Movement drew parallels between the financial crisis and the food crisis: “We saw many speculators interested in food products. In 2006, speculation on wheat was declining, but the next year it escalated,” she said.

The Hungry for Justice report also explores other trends fuelling global hunger. Among them are climate change, the diversion of crops from food to biofuels, and cuts to agricultural budgets and subsidies imposed by the World Bank and IMF. 

The report highlights the “actions of some unscrupulous multinational corporations that remove massive amounts of money from developing countries in the form of unpaid taxes on hidden profits,” depriving governments of much needed revenue. And it warns that the spread of western diets, especially eating more meat, to other countries will exacerbate the strain on global resources.

With the world off course to meet the Millennium Development Goal of eradicating extreme hunger by 2015, action is needed urgently to resolve these problems. As the report points out:

There is, after all, enough food to go round. It’s just that all too frequently, it simply fails to get to the people that need it most – the hungry."

Please help us with the campaign by writing to the Treasury asking it to regulate food speculation.