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UN food agency chief warns against cereal speculators - Daily News Egypt

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UN food agency chief warns against cereal speculators

KHARTOUM: World governments and the private sector must bolster food output to thwart speculators who are pushing up the prices of cereals and other basic foodstuffs, the head of the UN food agency said in an interview. Speaking Tuesday on the sidelines of a regional conference in Khartoum of the Food and Agriculture Organization (FAO), …


KHARTOUM: World governments and the private sector must bolster food output to thwart speculators who are pushing up the prices of cereals and other basic foodstuffs, the head of the UN food agency said in an interview.

Speaking Tuesday on the sidelines of a regional conference in Khartoum of the Food and Agriculture Organization (FAO), Jacques Diouf told AFP urgent steps should be taken to prevent speculators from thriving.

"Who is there to stop someone from saying ‘I expect prices to climb so I buy and I stock?’ What is the legal base to stop someone from buying, paying and holding on to his stock?" Diouf asked.

"If you create the conditions for speculation then people will speculate. What must be done is to avoid creating conditions that allow people to speculate," he said.

The drought that has gripped Russia and the floods that devastated Pakistan as well as an upswing in food speculation have forced prices to climb near to levels of the 2007-2008 food crisis.

"We’ve almost reached the 2007-2008 level. The mitigating factor now is that stocks are still available while the price of oil, even if it is rising, is not at the 140-dollar mark," Diouf said.

In 2008, the price of cereals reached historic levels, provoking a food crisis and riots in a number of African countries, as well as in Haiti and the Philippines.

The FAO said in November that the global cost of food imports is rising sharply this year because of unexpected shortfalls in major cereals due to bad weather.

"Total cereal production will drop by two percent … Declining production has had an impact on prices," Hafez Ghanem, the deputy head of the Rome-based FAO, told a news conference on November 17.

Predictions in June said world cereal production would expand by 1.2 percent.

"We must be realistic and attack the problems at their root," Diouf said.

More investments are needed in order to face population growth in certain countries like India and China, he said.

According to the FAO there are 925 million people across the globe who suffered hunger or malnutrition this year — 10 percent less than last year thanks to improved economic growth in many countries.

But food production must increase by 70 percent worldwide — even double in under-developed nations — in order to meet the demands of a growing world population expected to reach 9.1 billion in 2050.

Increasing production means increasing aid allocations and resources to agriculture, particularly in developing countries, Diouf said.

He suggested that countries "who have financial resources but not water and land to grow crops" could cooperate "with countries who have the land and the water but not the financial resources."

Some companies have bought or taken long-term leasing contracts on arable land in Africa, namely in the Nile basin country of Sudan, in recent years.

These measures, known as "land grabbing", are frowned upon by experts because they are aimed at pushing small farmers off their land while the crops that are cultivated are destined for exports rather than domestic consumption.

Diouf called for a "code of conduct" to govern private investment in agriculture.

 

 

Topics: food prices

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https://wwww.dailynewssegypt.com/2010/12/08/un-food-agency-chief-warns-against-cereal-speculators/
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