Food speculation
Food speculation refers to the buying and selling of futures contracts by traders with the aim of profiting from changes in food prices. Food speculation can be both positive and negative for food producers and buyers. It is betting on
soy – even though too large price swings in an idealized economy are theoretically ruled out: Adam Smith in 1776 reasoned that the only way to make money from commodities trading is by buying low and selling high, which has the effect of smoothing out price swings and mitigating shortages.[1][2] For the actors, the apparently random swings are predictable, which means potential huge profits. For the global poor, food speculation and resulting price peaks may result in increased poverty or even famine.[3]
In contrast to food
trading activity.[4]
Food speculation may be a reason for
2007–08 world food price crisis is thought to have been be partially caused by speculation.[4][6][7]
Overview
Institutions such as
bubbles exploding because prices are less and less determined by the real match between supply and demand."[8] In 2011, 450 economists from around the world called on the G20 to regulate the commodities market more.[8]
Some experts have said that speculation has merely aggravated other factors, such as
Jawaharlal Nehru University in New Delhi, have pointed out that prices have increased irrespective of supply and demand issues: Ghosh points to world wheat prices, which doubled in the period from June to December 2010, despite there being no fall in global supply.[8]
See also
References
- ^ Gunther Capelle-Blancard,Dramane Coulibaly (2011). "Index trading and agricultural commodity prices: A panel Granger causality analysis". Économie Internationale. 2–3 (126): 51–72.
- ISBN 0-226-76374-9.
- ^ "Food speculation". Global Justice Now. 2014-12-09. Retrieved 2019-08-21.
- ^ a b Vidal, John (2011-01-23). "Food speculation: aFood speculation: 'People die from hunger while banks make a killing on food'". the Guardian. Retrieved 2019-08-21.
- ^ Islam, M. Shahidul. "Of Agflation and Agriculture: Time to Fix the Structural Problems" (PDF). National University of Singapore. Retrieved 23 June 2021.
- S2CID 155654460.
- ISSN 1471-0358.
- ^ a b c d e f g "The real hunger games: How banks gamble on food prices – and the poor lose out". The Independent. Archived from the original on April 3, 2012. Retrieved April 1, 2012.
External links
- Adam Prakash, ed. (2011). "Safeguarding Food Security In Volatile Global Markets" (PDF). fao.
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