Record profits for grain firms amid food crisis prompt calls for windfall tax
Companies at the centre of the global grain trade have enjoyed a record bonanza amid soaring food prices around the world, raising concerns of profiteering and speculation in global food markets that could put staples beyond the reach of the poorest, and prompting calls for a windfall tax.
The world’s top four grain traders, which have dominated the global grain market for decades – have seen record or near-record profits or sales. They are forecasting demand to outstrip supply at least until 2024, which is likely to lead to even higher sales and profits in the next two years.
Food prices have surged more than 20% this year, according to the UN Food and Agriculture Organisation. About 345 million people are experiencing acute food insecurity, according to the World Food Programme, compared with 135 million before the Covid-19 pandemic.
Olivier De Schutter, a co-chair of IPES-Food (the International Panel of Experts on Sustainable Food Systems) and UN special rapporteur on extreme poverty and human rights, said: “The fact that global commodity giants are making record profits at a time when hunger is rising is clearly unjust, and is a terrible indictment of our food systems. What’s even worse, these companies could have done more to prevent the hunger crisis in the first place.”
Four companies – the Archer-Daniels-Midland Company, Bunge, Cargill and Louis Dreyfus, known collectively as ABCD – control an estimated 70-90% of the global grain trade. “Global grain markets are even more concentrated than energy markets and even less transparent, so there is a huge risk of profiteering,” said De Schutter.
He said this year’s food price surge happened despite what are thought to be abundant global grain reserves, but there was
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