Tuesday, April 29, 2008

Speculators blamed for food-price crisis

Speculators blamed for food-price crisis
Futures players ‘ distorting access’ to food

The Associated Press

GENEVA — UN officials on Monday blamed market speculation for the re­cent jump in global food prices and called for a concerted effort to ensure the world’s poor can afford to feed themselves.

“We have enough food on this planet today to feed everyone," the head of the UN Environment Program, Achim Steiner, told The Associated Press in a telephone interview.

But, he added, “the way that markets and supplies are currently being influ­enced by perceptions of future markets is distorting access to that food."

“Real people and real lives are being affected by a dimension that is essen­tially speculative," said Steiner, noting that millions have found themselves unable to pay for food since prices be­gan to rise steeply at the start of the year.

Last week, the World Food Program asked for an additional US$755 million to fill the hole in its budget caused by rising prices and growing reliance on food aid among the world’s poor.

Steiner’s comments were echoed by the UN’s right-to-food advocate, who said that high food prices were destabi­lizing the world.

Jean Ziegler told reporters at the UN’s European headquarters in Geneva on Monday that the “daily mas­sacre of hunger" was being worsened by private equity companies seeking to profit from price swings on the interna­tional commodities markets.

Last week, a U.S. government regula­tor rejected the idea that speculative trading was the primary culprit be­hind surging prices of corn, wheat and other crops.

Bart Chilton, a commissioner with the U.S. Commodity Futures Trading Commission, said commodities mar­kets were functioning properly, and that shrunken harvests, smaller grain inventories and the declining value of the U.S. dollar were the reason for the all-time price highs.

But over the weekend Vietnam moved to curtail speculative buying of rice after consumers were panicked in­to buying up stocks.

State media quoted Prime Minister Nguyen Tan Dung on Sunday as insist­ing that supplies in Vietnam — the world’s second-largest rice exporter af­ter Thailand — were “completely ade­quate" for domestic consumption. He warned that any organizations and in­dividuals speculating in the commodi­ty would be “severely punished."

UN Secretary General Ban Ki-moon has called the heads of all the global body’s major agencies for a meeting this week in the Swiss capital, Bern, to discuss the food crisis. Other senior figures including World Bank Presi­dent Robert Zoellick and the director general of the World Trade Organiza­tion, Pascal Lamy, are also attending the closed gathering.

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