Banks are earning huge profits from betting on food prices in unregulated financial markets. This creates instability and pushes up global food prices, leaving millions going hungry and facing deeper poverty. In January 2014, after four years of our campaign, the EU agreed to introduce new rules to prevent hedge funds and investment banks from driving up food prices.
Big investment banks are betting on the price of staple foods, like wheat, maize and soya. This is causing food prices to rise and making people go hungry.
WDM is campaigning to put pressure on the UK government to back European proposals regulating betting on food prices in financial markets.
Find out more
Find out more about food speculation and how it is
affecting the world's poorest people by looking at our resources.
Read our research
Speculation in basic foodstuffs is a scandal when there are a billion starving people in the world. We must ensure markets contribute to sustainable growth. I am fighting for a fairer world and I want Europe to take the lead on that."
-Michel Barnier, european commissioner for the internal market
Banks, hedge funds and pension funds are betting on food prices in financial markets, causing drastic price swings in staple foods such as wheat, maize and soy.
These markets were originally developed for the benefit of those involved in the production of food, yet over the last 10 years they have changed almost beyond recognition. Deregulation has enabled speculators to dominate, causing drastic spikes and crashes in prices.
Massive food price increases are catastrophic for people in poverty in the global south, who spend most of their income on food. This results in:
In the last six months of 2010 alone, more than 44 million people were driven into extreme poverty as a result of rising food prices. At the same time, banks and financial investors are making a killing. We estimate that Barclays makes up to £340 million a year from betting, or speculating, on food prices. In the last five years, the amount of financial speculation on food has nearly doubled, from $65 billion to $126 billion.
Our report, The great hunger lottery explains food speculation and its impacts on the world’s poorest people while our latest report, Broken markets provides a more technical explanation of how financial speculation drives up food prices.
‘Futures contracts’ have been used for hundreds of years, helping farmers deal with the uncertainty of growing crops (such as unforeseen weather conditions). A futures contract means a farmer can sell his or her crops at a future date at a guaranteed price. However, these contracts can also be bought and sold by speculators who have no interest in the actual food being traded. Instead, by buying and selling the contracts they could profit from the prices changing over time – betting on the price of food.
These markets for futures contracts worked well until the late 1990s, when aggressive lobbying by bankers led to regulations being rolled back. New and complicated financial products created more ways to make money from betting on food.
Since 1996, the share of the markets for basic foods like wheat held by speculators – who have no connection to food – has increased from 12 per cent to 61 per cent.
WDM is not alone in identifying excessive speculation as a key factor in driving up global food prices. Lots of world leaders, civil social organisations, financial and business experts, academics and media commentators all support regulation of these markets.
If we do nothing, we risk having food riots in the poorest countries and also an unfavourable impact on global growth. We want regulation of the financial markets for commodities.”
- Nicholas Sarkozy, French president
From 2010-2014, we mobilised public pressure calling on the UK government to back proposals to regulate betting on food prices in financial markets.
Since July 2010, we have campaigned to raise the issue and in January 2014 the EU agreed to introduce regulation to help stop banks and hedge funds driving up food prices and worsening the global hunger crisis. Together with supporters, local groups and our allies in Europe, we have made this into an issue that cannot be ignored.
Now we’ve seen historic progress.
In line with our demands, new controls will curb financial betting on food contracts and increase the transparency of deals. They are a first step to reclaiming our world from the grip of finance.
We’ve been continually outraged by the UK government putting banks’ profits above people’s right to food by opposing tough controls throughout the negotiations. But despite some weaknesses the agreement represents huge progress, meaning that for the first time the EU has rules to tackle food speculation.
Click on this timeline to have a look at what we have done so far.
During the campaign, WDM called for two key measures to be included in Europe’s proposals for financial reform:
Following work by the Stop gambling on hunger campaign in the US, regulation of food speculation was included in the Dodd-Frank Act in 2010 which was brought in following the financial crisis. This shows what a successful campaign can achieve.
However, Wall Street is now lobbying hard to hinder the implementation of the new regulations and the US campaign has another fight on its hands. Strong regulation in Europe would help our US allies overcome this final hurdle.
“It is deeply alarming that the greatest proportion of activity in the futures markets no longer involves those in the supply chain but is, instead, taken up by speculators. Food commodities are too important to be played about with by day traders and speculators”
- President of National Farmers’ Union Scotland
Since we launched the campaign on food speculation in July 2010, we've produced and collected a range of resources on the issue. Here are some of the best.
How banks cause hunger - Infographic explaining how food speculation works and what can be done about it.
Frequently asked questions - A factsheet that answers all those questions you've ever wanted to ask to understand this campaign. Topics include financial markets, food prices and financial regulations.
Betting on hunger - An 8 page booklet to help to give you an introduction to food speculation: how it impacts the poor, what speculation is and what can be done about it.
Glossary of terms - A jargon busting guide to steer you through all the technical lingo that is associated with financial markets.
Not a game: speculation vs food security - Oxfam briefing showing the problems about food speculation and what can be done to deal with it.
Transforming our food system: the movement for food sovereignty - An introduction to an alternative approach to the food system that's emerging from the global south and how you can help to put it into practice.
Statement by over 100 organisations calling for excessive speculation on food to be curbed - An international call for action from signatories including the Africa Development Interchange Network (Cameroon), Alianza Mexicana por la Autodeterminación de los Pueblos (Mexico) and the Seed Institute (Kenya)
WDM's response to European consultation on financial reform - WDM's consultation response provides detailed analysis and presents an evidence base for regulating excessive speculation on food derivatives.
WDM's response to the high level planel of experts on food security and nutrition consultation on food price volatility.
Banks are earning huge profits from betting on food prices in unregulated financial markets. This creates instability and pushes up global food prices, making poor families around the world go hungry and forcing millions into deeper poverty. It’s time to stop bankers from gambling on hunger.
This document answers all your in depth questions about food speculation.
Baffled by 'derivatives'? Do you know your 'over the counter' from your 'hedge'? Food speculation is an issue that can get quite technical but here's our jargon busting glossary which will help steer you around the murky waters of financial markets.
A clearing exchange acts as the intermediary between the buyer and seller of a derivatives contract. So instead of the buyer and seller interacting directly, the clearning exchange becomes the buyer to each seller, and the seller to each buyer, of a contract. The clearing entity makes the payments to each side of the deal,
covering the buyer and seller from the risk of the other side defaulting. This in turn provides financial stability by insuring both parties against default.
In contrast, derivative contracts which are sold directly between two parties (see over-thecounter derivatives below) can be defaulted on as either side may not deliver either the goods or the money. It was non-payment of derivatives
contracts (not traded through clearing exchanges) which contributed to the 2007/08 financial crisis.
In return for being protected from default, buyers and sellers pay a fee to clearing
exchanges. This protects traders from default by the other party and creates a small cost for each trade which takes place. This cost is small for real users of commodity derivatives like farmers. In fact, most farmers choose to use centralised
clearing rather than over-the-counter trading, because their whole reason for using futures contracts in the first place is to protect themselves from risk. However the fee represents a deterrent for financial speculators to buy and sell contracts exclusively as a moneymaking venture.
A commodity is a type of good which is the same no matter who produces it. There is no difference in quality. Because a commodity is the same, it can be easily traded at one global price. For example, a tonne of copper is the same whether it comes from Chile or Zambia.
In contrast, televisions are not commodities as they can be differentiated by features, branding, size etc and therefore different models of televisions command different prices.
For most commodities there are markets where they are traded on the day and derivative markets where contracts are traded for future delivery of the product. In these markets, a single price is quoted for the commodity. The three main categories of commodities are food, metals and energy (primarily oil and gas).
Commodity index fund A commodity index fund is a way for institutional
investors such as pension funds, insurance companies and mutual funds to put money into commodities. Commodity index funds put money into a range of commodities in fixed proportions by buying futures contracts and other derivatives
in them. Those using commodity index funds see commodities as a way to diversify where their money is held. They tend to put money in and pull money out due to factors unrelated to supply and demand of individual commodities and look instead to indicators such as stock and property market signals. This can play havoc with
commodity prices as it divorces their value from the actual demand and supply of the commodity itself.
A derivative is a financial contract which does not involve the trade of any real product. It is ultimately based on the trade in something real, so its value is ‘derived’ from a real trade. A future is one form of a derivative contract. Derivatives
got more complex through the 1990s and 2000s as financial markets became increasing unregulated.
A futures contract is a contract between two parties to buy or sell an asset of standardised quantity and quality at a specific future date at a price agreed today.
WDM food speculation campaign
A hedge is when someone seeks to reduce their risk to price fluctuations. It can be done in many ways. For instance, a farmer can use futures contracts to hedge against large falls in the price of the crop they are selling. They forego the
benefit of any increase, but protect themselves from a fall.
Hedging is also used by financial traders to diversify risk. Putting money into commodities is seen by many financial traders as a hedge.
Commodities can be seen to move in line with inflation, or in opposite directions to shares. Therefore, a trader can protect themselves against inflation, or a fall in share prices, by putting some of their money into commodities.
Hedge funds are financial funds that put money into a wide variety of markets. They tend to have the fewest regulations applying to them of any financial institutions. They put money into all kinds of markets, including shares, government debt and commodity derivatives. Whilst they are called ‘hedge funds’ they do not hedge.
They tend to do the opposite. They put money into the riskiest activities as an attempt to get the highest returns. Methods they particularly use are borrowing lots of money to then trade with, short-selling and putting money into
derivatives. Hedge funds tend to be used by a small number of wealthy investors.
An over-the-counter derivative is a derivative traded privately between two financial traders; at least one of them will usually be a bank. The bank creates the derivative in a specific way for its client. Because it is created in private, the
rest of the market does not clearly see what is being traded at what price. Also, over-thecounter derivatives can easily be defaulted on, unlike those which go through clearing.
Pension funds are institutional investors that take pension savings from individuals and governments. They seek to make a return with which to fund the buying of pensions for those paying into the fund. Pension funds are one of the largest institutional investors in financial markets, because they account for a large
proportion of individuals’ savings.
Position limits place a limit on the amount of derivatives which can be traded in a particular market. They were created by US regulators in the 1930s to prevent excessive speculation on food commodities, whilst still enabling farmers
to use derivatives to hedge their risk.
Through the 1990s and 2000s, regulations in the US were weakened, allowing many speculators to be exempt from position limits that apply to them, particularly commodity index funds.
Short-selling is the practice of selling items on a financial market that have been borrowed from a third party with the intention of buying identical items back at a later date to return to the lender.
Traders normally undertake short-selling as a way to profit from falling prices.
For example, a hedge fund makes £10 by selling 10 shares for £1 each. These shares do not belong to the hedge fund but have been borrowed from an actual shareholder. A month later, the shares have dropped to 50p each and the hedge fund buys the 10 shares back for £5 and then returns the shares to their owner. In
this way, the hedge fund pockets the difference and makes a profit of £5.
Large amounts of short selling, for example of shares, leads to a large supply of shares on the market. This in itself can cause the price to fall. Short selling has been a major feature of the recent financial crisis, particularly in currencies,
shares and most recently in government debt in countries such as Greece.
However, it has not yet been as big a feature of commodity markets
where the main speculators (index funds) have been making money from rising prices.
Speculation has many different meanings and uses, some of them contradictory. When we refer to speculation, we refer to financial actors putting money into food derivatives to make money, without any intention of buying or selling real food. This speculation on food contrasts with farmers who buy commodity derivatives to protect themselves from the risk of big changes in price. For farmers, buying food
derivatives is effectively insurance.
WDM campaign video with interviews from Kenya.
Animation produced by our European ally World Economy, Ecology and Development (WEED).
Animation produced by the US Stop Gambling on Hunger campaign.
Investigation by the Real News Network looking at the role of commodity derivatives and how they push up the price of food.
News report by Al Jazeera on how bankers bet on the price of food. Features an interview with our director, Deborah Doane.
News report by the Ecologist on how the price of maize is causing massive problems in Mexico.
News report on MSNBC about Wall Street commodity speculation.
South-South News report on food speculation.
Investigation on Russia Today.
News report on the Real News Network.
There is strong evidence that speculation exacerbated the last oil and food bubble. Speculation will fuel the next one too, unless meaningful speculative position limits are established.”
- Sir Richard Branson, founder, Virgin Group
Our campaign has been featured in the media. Here is a selection of the coverage:
What Goldman Sachs should admit: it drives up the cost of food
the Guardian, 23 May 2013
A sunnier outlook for Barclays
the Independent, 26 April 2013
Exclusive: Britain running out of wheat as cold weather crisis hits farmers
the Independent, 6 April 2013
Barclays rakes in up to £750m betting on food prices in just three years
the Daily Mail, 13 February 2013
Goldman bankers get rich betting on food prices as millions starve
the Independent, 20 January 2013
Cost of food 'not going to stop' rising, warns UK chief scientist
the Telegraph, 2 January 2013
Our food speculation campaigner Heidi Chow speaks on radio 4
the World Tonight, 1 January 2013
Unholy trade of making millions out of misery
the Independent, 23 August 2012
FSA 'lobbies on behalf of City firms it regulates,' claims campaign group
the Guardian, 19 June 2012
Barclays makes £500m betting on food crisis
the Independent, 1 September 2012
Public Eye award singles out mining company Vale, Barclays
the Guardian, 27 January 2012
Act on food prices and hunger, economists tell G20
the Mail and Guardian, 11 October 2011
Mexico's poor suffer as food speculation fuels tortilla crisis
the Ecologist, 13 September 2011
It's time to get tough with the food casino
Globe and Mail, 4 August 2011
Giant grain firm buys up all British wheat in 'unprecedented' purchase
Bureau of Investigative Journalism, 30 July 2011
The case for regulation of commodity markets
Progress Online, 13 July 2011
How hot money is causing a food prices commodity boom
Daily Mail, 29 June 2011
As food speculators make money, the world's poorest suffer
CNN, 22 June 2011
Food prices mean trouble for poor and politicians
Reuters, 17 June 2011
UN report calls for regulation to curb speculators pushing up food prices
the Guardian, 5 June 2011
Should food be a protected commodity?
the Telegraph, 1 May 2011
Protestors to target Barclays' AGM over food price speculation
BBC, 27 April 2011
Barclays food commodity speculation blamed for spike in prices
New Statesman, 27 April, 2011
Barclays faces protest over role in global food crisis
the Guardian, 25 April 2011
Food speculation: 'People die from hunger while banks make a killing on food'
the Guardian, 23 January 2011
The great hunger lottery - WDM report showing how speculation on food impacts the poor, and what can be done about it.
Broken markets - WDM report showing that financial speculation has a clear impact on rising food prices and countering arguments to the contrary.
Barclays PLC and agricultural commodity derivatives - Report showing that Barclays Capital makes up to £340 million per year from food speculation.
Back to fundamentals (report) - WDM report explaining why position limits are needed to protect consumers, producers and businesses from the impacts of food speculation.
Back to fundamentals (briefing) - Policy briefing explaining why position limits are needed to protect consumers, producers and businesses from the impacts of food speculation.
The food crises: predictive validation of a quantitative model of food prices including speculators and ethonal conversion - Academic quantitative study finding that biofuels are causing a longer-term rise in food prices, while speculation has been responsible for the recent sharp fluctuations.
The relationship between commodities futures markets and food prices - Paper by economists Jayati Ghosh, Robert Pollin and James Heintz exploring whether greater liquidity contributes to more stable prices, and whether futures markets can affect food prices.
Agricultural outlook 2011-2020 - Report of the UN Food and Agriculture Organisation and OECD, which states that, "Almost all researchers agree that non-commercial participation in futures markets may amplify price movements in the short-term, even if they differ in their conclusions about other possible impacts."
The financialization of commodity markets - Report by the United Nations Conference on Trade and Development (UNCTAD) about the high increase in commodity prices accompanied by the growing presence of financial speculators in commodity markets.
Price volatility in food and agriculture markets: policy responses - Report by the UN Food and Agriculture Organisation (FAO) looking at volatility in commodity markets and what can be done about it.
Price formation in financialized commodity markets: the role of information - Report by the UN Conference on Trade and Development (UNCTAD) on the lack of information in financialised commodity markets.
Food commodities speculation and food price crises - Briefing note by Olivier de Shutter, the UN Special Rapporteur on the Right to Food, outlining the regulation needed to reduce volatility in commodity markets.
Placing the 2006/2008 commodity price boom into perspective - Research by the World Bank showing that commodity speculation may have been partly responsible for the 2006-2008 increase in food prices.
Excessive speculation in agricultural commodities - Collection of writings on food speculation from 2008-2011 put together by the Institute for Agriculture and Trade Policy.
The Hunger Makers - Report from Foodwatch on how Goldman Sachs and other financial institutions are driving up the price of commodities through speculation.
This report, written by Brett Scott on behalf of WDM, is an overview of Barclays' involvement in commodity derivatives markets, with particular reference to its involvement in agricultural commodity derivatives (food speculation).
Derivatives come in three main types: Futures/forwards, options and swaps. In practice, a lot of the dealing on investment bank trading floors will be in ‘over-the-counter’ (OTC) derivatives, which includes forwards, swaps and bespoke options. Futures are slightly different, in that they are traded on regulated exchanges. All these derivative types can be based on different ‘underlying assets’ - e.g. derivatives based on shares, bonds and currencies, economic indicators, and a lot of other things. By far the largest global derivative market is the interest rate derivatives market, followed by currency derivatives, credit derivatives, commodity derivatives, and equity derivatives.
Barclays Capital commodities division is a commodity derivatives business, facilitating derivative markets in energy commodities (e.g. oil, oil distillates, natural gas, coal), industrial metals, precious metals, carbon emissions, and agricultural commodities. There are roughly 350 employees. Barclays describes the business as follows:
Barclays Capital’s Commodities division has expanded rapidly in recent years to meet growing customer demand. Our Commodities Traders build ‘trading books’ specialising in goods from energy products to agricultural assets, all over the world.
Broken Markets seeks to counter the arguments put forward by those sceptical of the influence of financial speculation on rising food prices. It shows how financial speculation has boomed, turning commodity derivatives into just another asset class for investors, distorting and undermining the effective functioning of agricultural markets.
It shows how these changes in the financial markets translate into changes in the price of food, and the devastating impact this has had on the world’s poorest people. It concludes by recommending urgent action to introduce new rules to limit the influence of financial speculators and bring transparency and stability to these out of control markets.
In The Great Hunger Lottery, the World Development Movement has compiled extensive evidence establishing the role of food commodity derivatives in destabilising and driving up food prices around the world. This in turn, has led to food prices becoming unaffordable for low-income families around the world, particularly in developing countries highly reliant on food imports.
Nowhere was this more clearly seen than during the astonishing surge in staple food prices over the course of 2007-2008, when millions went hungry and food riots swept major cities around the world. The great hunger lottery shows how this alarming episode was fueled by the behaviour of financial speculators, and describes the terrible immediate impacts on vulnerable families around the world, as well as the long term damage to the fight against global poverty.
In the report we describe how the current situation came to pass, the risks of another speculation induced food crisis, and what specifically can be done by policymakers here in the UK as well as in the US and EU to tackle the problem.
The European Commission and the French and US governments have all said they want to bring food speculation into the open and regulate it to stabilise prices. We need to you to help pressure the UK government to ensure that it backs proposals for regulation and not to take sides with the banks to block reform.
Email George Osborne at the Treasury, asking him to support strong and effective regulation to stop banks from betting on hunger. The Treasury is the government department which decides whether the UK will support international regulation to rein in excessive speculation on food prices
The impact of financial speculation on food prices is now widely recognised, and this needs to be subject to control without delay.”
- Olivier De Schutter, UN special rapporteur on the right to food
WDM is not alone in identifying excessive speculation as a key factor in driving up global food prices. Lots of world leaders, civil social organisations, financial and business experts, academics and media commentators all support regulation of commodity futures markets.
SOMO, the Netherlands
Corporate Europe Observatory, Belgium
Over 100 civil society organisations globally supporting the campaign aims.
Over 450 economists in more than 40 countries calling for regulation of food speculation.
European commissioner for the internal market, Michel Barnier, January 2010:
“Speculation in basic foodstuffs is a scandal when there are a billion starving people in the world. We must ensure markets contribute to sustainable growth. I am fighting for a fairer world and I want Europe to take the lead on that."
United Nations special rapporteur on the right to food, Olivier de Schutter, September 2010:
“The global food price crisis that occurred between 2007 and 2008, and which affects many developing countries to this day, had a number of causes. The initial causes related to market fundamentals, including the supply and demand for food commodities, transportation and storage costs, and an increase in the price of agricultural inputs. However, a significant portion of the increases in price and volatility of essential food commodities can only be explained by the emergence of a speculative bubble.”
French president, Nicolas Sarkozy, January 2011:
“If we do nothing, we risk having food riots in the poorest countries and also an unfavourable impact on global growth. We want regulation of the financial markets for commodities.” J
Then director-general of the UN Food and Agriculture Organisation (FAO), Jacques Diouf, January 2011:
“[There is] a pressing need for new measures of transparency and regulation to deal with speculation on agricultural commodity futures markets."
La Via Campesina, international movement of small scale food producers, October 2011:
“Financial speculation is and has been widely recognised as the major cause of the food crisis of 2007-2008 and should therefore be efficiently stopped at the international or regional level if we really want to prevent this from happening again.”
80 NGOs including Labour, Health and Human Rights Development Centre, Nigeria, Centre For Social Concern, Malawi, and Grupo de Solidaridad-Arenal, Nicaragua, March 2010:
“Undue influence on food and energy commodity prices by speculators continues today as seen in unusually high oil prices… With global food production heavily dependent on oil … volatile energy commodity prices means volatile food prices.”
Manager of Masters Capital Management hedge fund, Michael Masters, May 2008:
“Are institutional investors contributing to food and energy price inflation? … My unequivocal answer is “YES.” … What we are experiencing is a demand shock coming from a new category of participant in the commodities futures markets: … pension funds, sovereign wealth funds, university endowments and other institutional investors. Collectively, these investors now account on average for a larger share of outstanding commodities futures contracts than any other market participant.”
Chief economist of Goldman Sachs, Jim O’Neill, April 2009:
“I see so much focus on food, and it seems to be so trendy in the investment world. … The markets seem to me to have a bubble-like quality.”
Chairman of the US regulator, Commodity Futures Trading Commission, Gary Gensler, June 2009:
“Over the past few years, price spikes and unprecedented volatility in the commodity markets have hurt farmers, consumers and businesses."
Professor of economics at Jawaharlal Nehru University, New Delhi, Jayati Ghosh, May 2010:
“Globally the world trade prices of food have been rising since about April 2009, and all the indications are that they're rising for the same reasons that they rose way back in 2007-2008, which is to say that it's not driven so much by global supply and demand factors, but it's driven by financial involvement in the commodity futures markets.”
18 economists including Ilene Grabel and Martin Wolfson in a letter to US Congress, June 2010:
“Deregulation that began in 2000 … encouraged hyper-speculative activities by market players who had no interest in the underlying physical commodities being traded. This produced severe price swings for both oil and food in 2008-09 and destabilized business and household budgets in the US and throughout the world.”
Founder of Virgin Group, Sir Richard Branson, October 2010:
“There is strong evidence that speculation exacerbated the last oil and food bubble. Speculation will fuel the next one too, unless meaningful speculative position limits are established.”
Chief executive of Unilever, Paul Polman, January 2011:
“One of the main things in food inflation is that it has attracted the speculators for short-term profit at the expense of people living a dignified life. It is difficult to understand that if you really want to work for the long-term interests of society.”
Chief executive of Starbucks, Howard Schultz, May 2011:
“Without any real supply or demand issues we are witness to the fact that most agricultural food commodities are at record highs at once, and coffee is at a 34-year high. Through financial speculation … the commodities market is in a very unfortunate position.”
‘Futures contracts’ were first created in the United States in the 19th century to help farmers deal with the uncertainties involved in growing crops, such as unforeseen weather conditions. A ‘futures contract’ enables farmers to sell their crops at a future date, at a guaranteed price. This gives farmers greater certainty when choosing which crops to grow.
To buy a futures contract you do not need to buy or sell actual food and so financial players entered the market to make money from these contracts. Following the Wall Street Crash in the 1930s, regulations were introduced by the US government to limit speculation on food prices. But these regulations were weakened in the 1990s through corporate lobbying which allowed rampant betting on the price of staple foods by bankers.
Complex contracts were created called ‘derivatives’. This just means that the value of the contract is ‘derived’ from the commodity being traded. But no actual trading of the physical commodity needs to take place. Derivatives are based on the concept of a ‘futures’ contract but have become more complex.
The price of derivatives in food is affected by demand and supply. As more derivatives in a food are bought, the more the price of a derivative contract rises. This causes the ‘future’ price of food to rise. As mentioned above, this rising price of food in the future has a knock-on effect on the real price of food now.
To buy a futures contract you do not need to buy or sell actual food. However, the price of food in a futures contract helps to determine the real price of food. If futures prices rise, it is likely to cause the real price of food to rise.
For example, if a tonne of wheat is selling for £100 today but through a futures contract the farmer can sell that same tonne of wheat for £200 in three months then the farmer may choose to hold back the sale of wheat until then. This reduces the quantity of wheat being sold and with less wheat being sold, today’s prices will be pushed up. Alternatively, the farmer may demand £200 now from buyers, in which case the price today will also be pushed up.
Rising prices can also increase demand as buyers look to make purchases sooner to avoid future price increases. This increase in demand then pushes up the price of food.
The main way that investors speculate on food commodities is through ‘commodity index funds’. These indexes put money into derivatives across a range of commodities (such as oil, metals and food). They were mainly created by banks such as Goldman Sachs and Deutsche Bank. It is estimated the total money in such index funds increased from US$46 billion in 2005 to US$250 billion by early 2008. Money began to be taken out of the index funds in the months before food prices began to fall dramatically in mid-2008.
Commodity indexes are open for anyone to invest in, just like the FTSE 100 index for shares. However, they are rarely marketed at ‘ordinary’ people, and instead tend to be used by institutional investors such as pension funds, insurance companies and mutual funds (a professionally managed fund which pools money from individual investors).
Banks play an important part in the working of index funds. Banks tend to arrange the buying of derivatives contracts for their clients as well as act as the seller of contracts the index fund is buying. This effectively means banks are trading against their own clients.
The banks at the centre of commodity speculation include Goldman Sachs, Morgan Stanley, Barclays Capital, Citibank, Deutsche Bank, HSBC and JP Morgan.
Some speculation does follow market trends. This has the potential to amplify market changes, making them more extreme. However, speculation by index funds in particular does not pay attention to demand and supply in a particular commodity market. In addition financial speculators as a whole are less likely to pay attention to supply and demand than commercial traders.
Financial traders who put money into commodity speculation do so to diversify the kinds of things they have money in, in addition to more traditional places to put money such as shares, currencies and government bonds. Money therefore comes and goes into and out of commodities for reasons unrelated to the supply and demand of that commodity. This can create price trends, increasing price inflation and volatility.
Defenders of speculation argue that the extra cash (or liquidity) that it brings helps to smooth the process of buying and selling, stabilising the market. They claim that because speculators are believed to buy when prices are low and sell when prices are high they even out price volatility.
However, once speculators dominate the market, they can end up creating and following price trends to form bubbles that distort prices – at least in the short and medium term.
Even temporary spikes in food prices can have devastating effects on consumers in poorer countries.
High food prices means buying less food, or having less money to spend on other things. Higher food prices are causing more people to go hungry. The 2007-8 food crisis pushed another 115 million people into hunger. Food price rises forced 44 million people into extreme poverty in the last six months of 2010 alone. Nearly 1 billion people are now chronically malnourished.
But the impact of high prices goes well beyond not getting enough to eat. Poor households in developing countries tend to spend between 50 and 90 per cent of their income on food, compared to an average of 10-15 per cent in developed countries. As well as eating less food, households have been forced to:
Eat less fruit, vegetables, dairy and meat in order to afford staple foods such as wheat. This can have drastic impacts on protein and vitamin intake. Nutritional deficiencies particularly affect children, pregnant women and unborn children.
Reduce any savings or take out loans. This can include selling off assets vital to future income such as land or cattle.
Reduce spending on healthcare, education or family planning.
Women tend to manage the food budget and often bear much of the suffering. Women may also try to increase income through taking on insecure and risky employment as domestic workers, mail-order brides and sex workers.
Even in countries such as the UK, low-income households are badly hit by food price inflation, with prices 6.9 per cent higher in June 2011 than a year earlier.
Both. The extreme increase in the price of food caused major problems for households in developing countries as mentioned above. But increased fluctuations also create problems.
In recent years, there have been greater fluctuations in food prices. These price swings make it difficult for both producers and consumers of food. For instance, farmers may choose to plant a certain crop on the basis of its high price, but find that the price has collapsed by the time they harvest.
Extreme variations in food and oil prices also make it more difficult for governments to plan how to run their economies. Whether they are net importers or exporters of food and oil, big price changes can play havoc with growth rates, tax revenues, debt and inflation. All of which make it more difficult to manage the economy in a sustainable way.
For instance, the FAO says: “At the national level, many developing countries are still highly dependent on primary commodities, either in their exports or imports. While sharp price spikes can be a temporary boon to an exporter’s economy, they can also heighten the cost of importing foodstuffs and agricultural inputs. At the same time, large fluctuations in prices can have a destabilizing effect on real exchange rates of countries, putting a severe strain on their economy and hampering their efforts to reduce poverty.”
No, high food prices affect poor farmers as well as the urban poor. Very few poor farmers produce a significant surplus to sell and a high percentage of rural households are net buyers of staple foods. In Kenya and Mozambique, around 60 per cent of rural householders are net buyers of maize.
In Zambia, 80 per cent of farm households grow maize, but fewer than 30 per cent sell any. Any farmers who do have a surplus to sell may see little benefit of higher prices. The FAO says that consumers in urban areas are more likely to see the effects of higher prices than producers in rural areas. Moreover, large producers which are part of large (sometimes multinational) companies are most able to benefit from high prices.
Africa has gone from being a net exporter of food in 1970 to a massive net importer. Around 55 per cent of developing countries are net food importers and almost all countries in Africa are now net importers of cereals. This means they are hugely reliant on the world food prices of their staple foods and higher prices have a direct impact on their ability to feed themselves.
Fairtrade products guarantee a fairer, higher price for farmers growing crops in developing countries which are exported to countries like the UK. Typical Fairtrade crops are ‘cash crops’ like cocoa, coffee and sugar. Higher prices received for such products are good for farmers and communities growing such crops.
One key aspect of Fairtrade is that it guarantees stable prices. Therefore farmers do not suffer from the wild fluctuations in prices (see above) which are partly caused by financial speculation. However, even farmers benefiting from stable higher prices for their cash crops due to Fairtrade still have to buy staple crops for their own consumption, which continue to fluctuate wildly in price.
The Fairtrade Foundation states that the majority of its “farmers like most smallholders, are net food buyers and as such only a minority have gained from increased commodity prices”.
Through the 1980s and 1990s many developing countries suffered from low commodity prices, particularly for tropical commodities such as sugar, cocoa, coffee, tea, jute, cotton and rubber. One estimate is that by 2002, developing countries were losing $240 billion a year from the fall in price of then top ten tropical commodity exports since the 1980s. The price of commodities was due to rise.
Whether or not a country’s economy has been helped or hindered by high commodity prices in recent years depends on how much the price of commodities it exports increases compared to those it imports. During 2007 and 2008 the price of oil and staple foods, such as wheat and maize, tended to increase a lot more than that of cash crop exports such as cotton, coffee and cocoa. This meant that the amount they were paying to buy the food they ate outweighed the income received from selling cash crops.
More fundamentally, what is most important for developing countries as a whole is to receive stable prices on which they can plan their economic development. One of the reasons low prices for crops such as coffee were so damaging in the 1990s is that the World Bank had made countries start growing a small number of popular crops assuming that the price would be higher.
Speculation destabilises countries because it makes prices more volatile as they fluctuate more. Pedro Paez, former Ecuadorian minister for economic policy coordination, says that both high and low prices “are bad because both are the result of a distortion in the market. For example, the oil price because of speculation on futures went as high as $150 per barrel, and then due to short-selling dropped in four weeks to less than $40. How as an importer or exporter can you plan a sustainable economy under those conditions? If you export just three basic commodities but don’t have any idea what the future price will be, your food security is very vulnerable. The lives of millions of people come to depend on the activities of a handful of financial speculators.”
No, there were differences in how food prices changed between commodities. There were changes in supply and demand which would have caused price changes without speculation. However speculation amplified the impacts of these price changes. For example, Brazil has rapidly increased production and exports of sugar, with a higher quantity available in the world market, there has been little scope for speculation to amplify a price change.
Consequently, there is evidence that there was no increase in financial speculation in sugar futures in 2007 and 2008. Some important staple foods such as sorghum, millet and cassava are not traded on futures markets – because they aren’t produced or consumed in the main trading centres. Prices for such crops rose in 2007/08, though by nowhere near as much as for wheat and, maize and rice.
This is evidence of the role of financial speculation in driving up prices of crops such as wheat and maize. Specifically in reference to the potato, research for the FAO says: “being absent in the major commodity exchanges, there is no risk of potato bearing the ill-effects of speculative activity, which cannot be said of cereal commodities”.
However, if the price of imported food such as wheat and maize has risen, this is likely to have a knock-on impact on locally produced crops such as sorghum as demand for them increases to replace more expensive foods.
Very little rice is traded on international commodity exchanges or in futures contracts. Yet the price of rice increased far more than that of wheat in 2007 and 2008. Does this mean that speculation was not the problem?
The international market for rice is very small; about 6-7 per cent of global production. As the rice price rose, key rice exporters such as India, Vietnam and Thailand introduced export bans to protect rice availability for their own people, making the international market even smaller. The rising price also probably prompted households to buy and store more rice, in anticipation of rising prices, which caused prices to rise further.
Some commentators point to rice to show that financial speculation was not a problem. It is undoubtedly the case that the reason the rice price went so high was due to the factors listed above. However, there is strong evidence that the extreme increase in the price of wheat triggered the increase in the price of rice.
In some countries, most importantly India, rice and wheat are substitutes for each other. India is a large net importer of wheat. The average cost of India’s net wheat imports rose from $220 a tonne in 2006 to $255 a tonne in 2007 and $370 a tonne in 2008. As well as causing the local wheat price to rise, this also led to India importing far less wheat in 2008.
Net imports fell from 5 million tonnes in 2007 to just over 700,000 tonnes in 2008. This rise in the price of wheat and fall in wheat imports had knock-on impacts on rice price and demand.
The global price of wheat increased particularly in late 2007, whilst the rice price increase began in early 2008. Statistical tests show that at times the price of rice is ‘caused’ by the price of wheat. There was a crucial period at the start of 2008 when statistical tests by a researcher for the FAO have shown that the rise in the price of rice was ‘caused’ by the rise in the price of wheat.
Prices of rice, wheat and maize 2001-2009, IMF Similarly, a research paper for the World Bank says that there was little change in production or stocks of rice, and the initial increase in world rice price was caused by the increases in wheat prices in 2007. An FAO food outlook report says: “The shock to demand for rice was largely generated by demand to make up shortfalls in wheat available to consumers.”
Financial speculation can be said to have had an impact on the rice price by amplifying the increase in the price of wheat, which in turn triggered the dramatic increase in the price of rice.
The prices of key staples wheat, maize and rice fell sharply after the spike in 2007 and 2008, but generally remained above pre-2006 levels. Food prices have risen again since mid-2010, setting new records for three consecutive months from December and remaining high. Moreover, the volatility of food prices – how much they move around – seems to still be higher than before 2006.
These recent increases have not yet produced a global food crisis thanks to good 2010 harvests in many African countries that kept prices stable. Rice has also avoided drastic price increases. However high prices are one factor in the food crisis experienced in the Horn of Africa in 2011.
Chocolate producers have identified speculation as a key reason why cocoa prices reached an all time high in April 2010. As long as speculators are not regulated they will be able to cause big increases and changes in price, with disastrous consequences for people across the world.
Oil definitely has an impact on food price by affecting the cost of transport fuel and fossil-fuel based fertiliser. But the oil price rise was due in part to speculation as well. The price of a barrel of oil increased from $60 in 2006 to almost $150 in mid-2008, before falling rapidly to $40 in a matter of weeks. Whilst there are underlying reasons for a rising oil price, these extreme swings can only be explained by speculation.
An April 2010 survey of banks, traders and oil companies found that 70 per cent say speculation is currently increasing the price of oil, on average by $10 to $30 a barrel.
Isn’t it a good thing that oil price is high to deter people from using it?
If high oil prices are sustained several things are likely:
Investing in alternative and more energy efficient technologies becomes more attractive.
But investing in increasing oil extraction, particularly from the dirtiest fuels such as tar sands, also becomes more attractive. A high oil price by itself will do nothing to tackle climate change. Government intervention is needed to ultimately keep oil in the ground.
Most developing countries are net oil importers, so higher oil prices add to their import bill. After food, energy is one of the largest expenditures for poorer people.
Whilst net oil exporters benefit from high oil prices, they are affected by the high volatility of the oil price. Whether they are net importers or exporters of food and oil, big price changes can play havoc with growth rates, tax revenues, debt and inflation. All of which makes it more difficult to manage the economy in a sustainable way.
For real demand and supply reasons oil prices are likely to continue rising over the medium-term. This is a reason for all countries to invest in cleaner alternatives. But large swings in oil price, and artificially high prices, are likely to create more problems than they solve.
Surely there are much more important factors driving the movement of food prices – isn’t speculation relatively unimportant?
There are many factors driving the movement of food prices. Increased use of biofuels diverts food from humans to being fuel for cars. Changes in crop yields from year to year affect food supply, and such changes are likely to get more extreme as climate change increases. Increases in oil and fertiliser prices also make farming more expensive, and so increase the price of food.
No one campaign or policy can tackle all the complexities which cause hunger in our world. Governments need to support smallholder farmers who produce most of the world’s food and should invest in food reserves to help promote stable prices. But excessive speculation is a perversion, amplifying price movements and making them worse.
It can be regulated simply and painlessly. Doing so would also have other benefits.
Two key measures are needed to ensure that financial speculation cannot distort food prices and cause hunger:
‘Position limits’ to cap the share of the market held by financial speculators (as opposed to actual food traders using futures markets to insure themselves against the risk of price changes).
Clearing of almost all derivatives on regulated exchanges, instead of secretive, private ‘over-thecounter’ deals (which currently account for 84 per cent of derivatives trading). This would increase transparency, allowing everyone to see what is being traded at what price. It would also ensure that most derivative trading is subject to proper oversight and regulation, which does not currently happen for over-the-counter trading.
The European commission is drawing up proposals to regulate speculation, mainly through the ‘Markets in Financial Instruments Directive’ (MiFID). These will be considered by the European Parliament and member country finance ministers. The UK government could be a major stumbling block to effective regulation.
The UK government accepts the need for more transparency but does not want to introduce position limits. Instead ministers are in favour of ‘position management’, which they say gives regulators the flexibility to intervene in the market when necessary. In practice however, they have tended to be so hands-off that position management has amounted to complete deregulation.
Clear position limits are needed to limit the influence of financial speculators and effectively stabilise the futures market.
Because the price of commodity futures has been increasingly driven by financial speculation, it has become more difficult for real buyers and sellers of food to use futures to manage their risk. For example, a subcommittee of the US senate has found that in 2007 and 2008 some US farmers were unable to afford future contracts to manage the risks involved in farming.
Large amounts of money tied up in futures contracts is also a waste of resources. Instead of being used on speculation, resources could be used on genuine assets and investment to increase production. This opportunity cost is particularly pertinent following the credit crunch, as small and medium sized businesses have struggled to secure sufficient capital.
Limiting speculation on commodities could divert resources to being invested in genuinely productive activities.
Futures contracts are useful to farmers and processors of food to manage the risk of price changes. Some ‘speculation’ is needed for farmers and processors to do this. Speculators are effectively needed to provide insurance. However, there is no reason for the excessive amount of speculation we have seen in recent years.
Limiting the amount of speculation would prevent excessive speculation, whilst still enabling farmers and processors to use futures as a form of insurance for which they were originally intended.
Since the food and oil price spikes in 2007 and 2008, the US government has expressed concern over the impact of financial speculation. Gary Gensler, appointed by President Obama as Chairman of the US regulator the Commodity Futures Trading Commission (CFTC), says: “I believe that increased speculation in energy and agricultural products has hurt farmers and consumers.”
In 2010 the US passed legislation to re-regulate financial markets. However, implementation of measures to curb commodity speculation is being slowed by political and financial opposition to reforms. There is a strong campaign of over 400 groups in the US campaigning for regulation of commodity speculation, including civil society organisations, farmers and businesses.
Action in Europe would also help the campaign in the US. Food speculation has also been on the G20 agenda in 2011. A strong mandate from G20 leaders to tackle commodity speculation could ensure that food speculation is curbed around the globe.
Without any real supply or demand issues we are witness to the fact that most agricultural food commodities are at record highs at once, and coffee is at a 34-year high. Through financial speculation … the commodities market is in a very unfortunate position."
- Howard Shultz, chief executive of Starbucks
Financial speculation has overwhelmed agricultural derivative markets. It has inflated prices, increased price volatility and created bubbles completely unrelated to supply and demand.
In a well-functioning market, prices should be affected only by changes in supply and demand. But data from the US Department of Agriculture on global supply and demand for wheat and maize shows that here have been no significant changes that could have caused the large price rises that we have seen in recent years.
While other factors such as export bans, increased demand for biofuels, climate change and increased food consumption in China and India have contributed to long-term price rises, they cannot explain the short-term price fluctuations that we have seen in recent years.
Instead, speculation lies at the heart of the problem. But how does it work? To understand it we first need to understand futures contracts and their role in food markets.
Futures allow farmers to agree a guaranteed price with a buyer for their next harvest well in advance, giving them greater certainty of income when planting crops. In a sense, a futures contract is a form of insurance against price changes. In financial terms, it enables a farmer to hedge their risk.
Futures contracts can then be traded on futures markets, with other farmers, food buyers or speculators. Speculators aim to make money by buying and holding on to the contracts, seeking to profit from changing prices. Having a degree of speculation helps these markets function , making sure that farmers have someone to pass their risk on to.
Until the 1990s futures markets were regulated through position limits (a limit on the amount of the market that can be held by big traders). But following lobbying by banks such as Goldman Sachs these markets were deregulated. As a result, financial speculators flooded the market with over $100 billion. This money wasn’t being traded based on the supply or demand for food, but was largely bet on rising prices, forcing prices to rise higher and faster.
But how do futures contracts affect the physical price (spot price) of commodities? It does so in three main ways:
Because there aren’t many major central markets for food commodities, it is often difficult for food producers and buyers to know what the physical price of food should be. Instead, the prices of the numerous trades in the futures markets are often used as a benchmark for negotiating real prices for food. If futures prices are high, this changes the expectations of buyers and sellers in the physical markets and physical prices go up. If food producers see that prices will be higher in the future, they will often wait to sell their food, thus reducing supply and increasing prices now. In addition, if food buyers see that prices will be higher in the future they will be more willing to pay more now, also increasing prices.
Futures prices are often used as the basis for pricing physical market contracts. For example, grain prices on the major Chicago exchanges tend to be incorporated directly into grain contracts the world over.
By incorporating the futures price directly into physical commodity contracts the prices from the financial markets are translated straight into the prices of food.
Traders who are willing (and able) to take physical delivery of a commodity can profit from differences between futures and physical prices. If futures prices are higher than physical prices, traders wanting to buy physical commodities who hold futures contracts near the delivery date will sell them and try to buy (cheaper) physical contracts. This then increases demand for physical commodities now, pushing up physical prices. Traders call this process arbitrage.
11 October 2011
Dear G20 Finance Ministers,
We write to you ahead of the October meeting of the G20 Finance Ministers to urge you to commit with your counterparts to take effective action to curb excessive speculation on food commodities. Excessive financial speculation is contributing to increasing volatility and record high food prices, exacerbating global hunger and poverty.
While there are many pressures on food prices, fundamental changes in supply and demand cannot fully account for the dramatic price fluctuations that have occurred in recent years.
In June, a report for the G20 by international organisations including the IMF and the OECD noted that “too much speculation can cause frequent and erratic price changes” in futures markets. Evidence suggests that financial speculators are less likely to make trading decisions based on information regarding supply and demand and are more prone to herding behaviours than commercial traders. Excessive speculation undermines the price discovery function of futures markets, driving real prices away from levels determined by supply and demand.
The High Level Panel of Experts on food security for the Committee on World Food Security at the FAO reported in July that “tighter regulation of speculation is necessary.” The panel suggested that “Increasing transparency, by requiring exchange trading and clearing of most agricultural commodity contracts, and setting lower limits for noncommercial actors could be the first set of measures taken by the countries that house major commodity exchanges.”
Increasing market transparency is vital, but will not go far enough to tackle excessive financial speculation. We therefore urge you to support the establishment of position limits to cap the proportion of agricultural commodity derivatives markets that can be held by financial speculators. Limits could be set at a level that would maintain sufficient liquidity in the markets while preventing an excessive concentration of purely financial actors. The US has already passed legislation including provisions to introduce such limits and the G20 should act to prevent regulatory arbitrage between exchanges.
Position limits would be more effective in tackling excessive speculation than position management powers, which rely on the use of judgement by exchanges and provide little assurance that powers will be exercised effectively. Clear limits would provide regulatory certainty, promoting stable and sustainable derivatives markets to the benefit of food producers, consumers and broader economic stability.
With around 1 billion people enduring chronic hunger worldwide, action is urgently needed to curb excessive speculation and its effects on global food prices.
cc: Michel Barnier, European commissioner for internal market and services
Mr Abdulhafiz Ahmed Abdisubhan, Finance and Economic Development Bureau, ETHIOPIA
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Barclays is the UK’s biggest player in food speculation. Despite closing parts of its agricultural commodity trading business, Barclays continues to play a role driving up food prices and leaving millions facing hunger and malnutrition.
On 12 February 2013, after three years of public campaigning by WDM that called on the bank to stop betting on hunger, Barclays announced it would no longer trade in agricultural commodities “for speculative purposes”, saying that the practice was “not compatible with our purpose”. This was a campaign success worth celebrating.
However, despite ending its controversial speculative deals with hedge funds, Barclays continues to offer opportunities for others to speculate on food. It remains the biggest UK high street player in food speculation and will retain a role as a broker for pension funds and large traders such as Cargill and Glencore to bet on the price of food.
We estimate that Barclays made up to £278 million in food speculation in 2012.
Barclays has admitted that they have reduced their involvement in food speculation because it was believed to be a potential cause of food price inflation.
Other investment banks across Europe are making similar admissions. This strengthens the hand of those calling for regulation.
However, such commitments from banks can be short lived. In 2012, Major Germany food speculator Deutsche Bank said it would not release new financial products enabling food speculation. However, in January 2013 it announced that it would be returning to the market, claiming that there was little evidence to support the idea that speculation affected food prices. This was despite its own research admitting a link between speculation and price volatility.
This example illustrates the need for firm regulation in Europe. With so many people vulnerable to world food price spikes, it is clear that individual banks cannot be trusted to stop speculating on their own.
Food speculation - banks betting on food prices in financial markets - is a massive issue facing the world today. In the last few years, we have seen two major food price spikes, pushing millions of people into poverty. These food spikes were caused by speculation and could have been prevented through effective regulation.
At the World Development Movement we are campaigning to stop banks betting on food and causing hunger. To explain the issue we have produced this infographic. Hope you like it. Please let us know what you think in the comments.
For more information about how financial speculation impacts on food prices, see our Broken markets report.
[Click on the image to enlarge it]
Update 5 October 2011: We have corrected the aid figures and their size relative to banks’ profits from food speculation; they now reflect the latest information.
Bexhill and Hastings WDM play a game of 'Human Blackjack' with George Osborne showing how the government's allowing bankers to keep betting on food.
Brighton & Hove WDM explaining the complexities of food speculation to passers-by in Brighton, using a giant snakes and ladders' board
Sheffield WDM created an ingenious 'plate-spinning' game at a recent event to involve people in our food campaign
On Saturday 8 June protests were held in support of food sovereignty, rather than David Cameron and the G8's preferred approach. Known as the “New Alliance for Food Security and Nutrition”, it will see aid money support big business, and developing countries forced to implement policies which will exacerbate rather than reduce hunger. Here are some photos from the protests.
Find out more about the background to the protests in our blog.
We are lobbying the UK government to demand tighter regulation of commodity speculation, which our report The Great Hunger Lottery reveals creates market volatility and sharp rises in the price of basic food commodities.
Maize, the staple food in Kenya, is gambled on in global commodity markets. In 2008, maize was subject to a 100% cost increase, which meant that many of the poorest people in Kenya went hungry, lost their livelihoods and suffered health problems.
In July 2010 some of our staff went to Kenya to speak to people about the effects of the food price rises. Here are some of their stories.
A new campaign If… on hunger and food security has launched, run by a group of development organisations. WDM has decided not to join this campaign.
WDM campaigns to tackle the root causes of poverty and injustice. Our current campaign on food goes to the heart of one of the problems with our food system: the power of the financial sector and the role of commodity speculation in causing food price spikes. We are also actively engaging with and contributing to a long term vision and solution – food sovereignty – guided by our allies in the global south.
As a small organisation, we do not have any additional campaign capacity to contribute to a food campaign with a different focus. The If... campaign is concerned with food security - ensuring people have enough to eat. However it will not be challenging the power and impact of the financial system on food prices, nor is it grounded in the principles of food sovereignty. WDM believes that these principles, which are about power, control and rights, must underpin future changes to our food systems.
We welcome many of the campaign demands in the If... campaign - for example those around tax havens, biofuels and landgrabbing. We encourage WDM members and supporters to take action on these and other structural problems with the food system.
You can read more detail about this in this blog written by our Director Deborah Doane published on the Guardian website.