Opinion (from AlertNet, Thomson Reuters Foundation): “Speculation on food prices played out on the trading floors of the Chicago Board of Trade and other commodity futures exchanges are to blame, critics say.
“’People are starving because the markets are out of equilibrium,’ said Yaneer Bar-Yam, director of the New England Complex Systems Institute (NECSI), a research institute, which has analysed the impact of speculation on food prices.
“’Food prices have nothing to do any more with the real price of food, or the availability of food,’ Bar-Yam told AlertNet. …
“’Deregulation of commodity markets has led to increased volatility and contributed to food price spikes that have caused massive harm to millions across the world facing hunger and poverty,’ said Christine Haigh, campaigns officer at the World Development Movement (WDM), an advocacy group.
“Before deregulation, agricultural futures markets were mainly used by farmers and food buyers to protect themselves from risks such as bad harvests. A futures contract provides protection by locking in a price for a promise to deliver a crop at a future date.
“But in recent years, investors have poured unprecedented amounts of money into agricultural commodities – spurred to hunt elsewhere for profits after the dotcom crash of 2000, the U.S. property market meltdown in 2006 and the 2008 financial crisis.
“They have become major players – in the past five years investment in food commodities by banks and hedge funds has risen to $126 billion from $65 billion five years ago, according to a report by WDM.
“A 2011 study by UNCTAD concluded that the commodities market had stopped to function ‘properly’ in a way where prices are shaped by supply and demand.
“’The activities of financial participants drive commodity prices away from levels justified by market fundamentals,’ the study said. …
“Wheat prices, for example, rose 46 percent between January and February 2008, fell back almost completely by May and increased again by 21 percent in July before falling again in August 2008. …
“There are signs some banks are listening to arguments that food price speculation harms millions of people. Germany’s DekaBank, last month said it was pulling out of investing in basic food stuffs, such as wheat, soya, maize and meat.”
My Comment: In the world, there is an excess of everything, including food. It is only the speculation of the “fat cats” that leads to the unequal distribution and hunger. The crisis, destruction, famine, and environmental catastrophe will compel us to decide to curb our egoistic nature. And the question of how to do this will lead us all to the method of integral upbringing.