Hi John,
This week we found out that it’s not only the food corporations that have made a killing from price hikes – so have the speculators. And this makes it all the more important that we stop the government’s attempts to hand these financiers even more power over our food.
Hedge funds have made billions of dollars of profit from the food price spikes over the last 18 months, according to new research.(1) And it gets worse. By gambling on the price of food, these speculators actually pushed up prices, fuelling inflation and making food unaffordable for millions of people.
In the words of the UN expert Olivier De Schutter “financial speculators have made obscene profits by betting on hunger and exacerbating it.”
Yet the British government is still pushing a bill through parliament that would hand the speculators even more power over the price of food and other commodities. The Financial Services and Markets Bill is a massive piece of financial deregulation through which the government aims to strip away important rules passed in the wake of the 2008 financial crash, including limits on commodity speculation.
The bill is currently in the House of Lords where we hope to win an amendment to remove these dangerous provisions. You can help us by signing up to the campaign petition, which we’ll hand to decision-makers in the coming weeks. Almost 50,000 of us have signed already – can you add your name now?
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We need stricter regulation on these markets, and we’ll be working with campaigners in the coming years to try to win such regulation across Europe and the US. But a vital starting point must be not to water down the rules we already have.
Speculators thrive on volatility. They are the last people who should be playing a key role in setting prices of basic goods. As De Schutter told the Guardian:
“This is not gold or silver we’re talking about, it’s people’s daily bread – driving up food prices affects millions and millions of people… These hedge funds have nothing to do with the production, buying and selling of food, they’re simply profiteering.”
Of course, speculation is not the only problem with the way our food is produced. In recent weeks we’ve been highlighting how the control of large parts of our food system by massive corporations has also played a role in hiking prices.(2)
While hunger climbs rapidly around the world, corporate investors have made billions of dollars. But this monopolisation has gone hand-in-hand with the growth of financial power. We need to transform the way our food is produced. And a key part of that is taking power back from the financial markets.
Can you join the nearly 50,000 of us trying to stop Rishi Sunak taking this backwards step now?
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Thank you for all your support,
Nick Dearden
Director, Global Justice Now
PS. The way our food system operates is also fuelling climate change, and from tomorrow we’re joining The Big One, four days of climate protest in the heart of Westminster. Check out our full programme of workshops and protests from Friday to Monday.
More info
- Top 10 hedge funds made £1.5bn profit from Ukraine war food price spike, Guardian, 14 April 2023
- Food barons are making a killing from this crisis, New Internationalist, 17 March 2023
- Stop blaming bad weather for empty shelves, it’s a lack of competition in the food industry, City AM, 10 March 2023
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