Food campaign news
European banks begin moving away from food speculation
There has been good news this week for those concerned with the impacts of food speculation on the world’s poor. The Danish bank Nordea, which is the largest financial services group in Northern Europe, has agreed to move out of agricultural commodities, whilst German bank Deutsche has announced that it is moving in the same direction.
In its annual report, Nordea acknowledges that there are “questions” over the impact of increased food speculation upon prices, as more and more of the market becomes held by financial players. According to Nordea “it cannot be out ruled that agricultural markets no longer respond to underlying fundamentals of supply and demand”. It is on this basis, Nordea has decided to stop offering financial products in food speculation.
In Germany, after mounting public pressure, Deutsche Bank announced that for the rest of the year it will not set up new investments in agricultural commodities whilst it researches the impact of speculation on food prices. It states in its latest corporate responsibility report: "Deutsche Bank has established a working group that is currently looking in great detail at the causes and effects of highly volatile, and above all, rising agricultural commodities prices… While the working group continues its analysis, the bank will refrain from setting up any new exchange-traded investment products based on basic foodstuffs this year."
How much of this is a genuine move by Deutsche remains to be seen but this is definitely a step in the right direction and will help put the pressure on European governments to support tough new proposals to tackle food speculation.