EU Asked to Tackle Speculation on Food Prices

Food prices in 2011 have reached the highest levels since the Food and Agriculture Organisation (FAO) started recording them in 1990, according to a European Parliament resolution adopted today in Strasbourg. The text also calls on the European Commission “to increase investment in farming and food security” and to “take the necessary steps to fight against the excesses of speculation on commodity markets.”

Said S&D Vice President Hannes Swoboda: “Anger over soaring food prices has literally put a number of countries on fire. A crucial cause has been speculation by traders and brokers who have no commercial interest in these markets.

“We do not want to see another Chocfinger scandal like the one last July when a hedge fund manager in London hoarded cocoa, creating an artificial shortage and forcing prices up. This kind of practice is not acceptable”.

Said S&D Vice President Stéphane Le Foll: “Rising production costs and price volatility are having a very negative impact on farmers’ ability to maintain production, paving the way to a growing EU dependency on food imports.

A key challenge for the new EU common agriculture policy will be therefore to ensure food security for EU citizens and a fair standard of living for farmers”.

Said S&D spokesman on economic and monetary affairs Udo Bullmann: “We call on the European Commission to make proposals during negotiations on the revision of the Markets in Financial Instruments directive (MiFID) and the Market Abuse directive to address these concerns. Financial instruments should serve the economy and help agricultural production surmount crises and climatic events – speculators should not have access to food and agricultural commodity markets.

“We also need to urgently set up a preventive mechanism against excessive fluctuations of price at international level.”

Mr Bullmann stressed: “The G-20 should work on regulation specifically designed to tackle the food and agricultural crisis. This work should involve countries that are not part of the G-20”.