A new vision for agriculture
momagri, movement for a world agricultural organization, is a think tank chaired by Christian Pèes.
It brings together, managers from the agricultural world and important people from external perspectives,
such as health, development, strategy and defense. Its objective is to promote regulation
of agricultural markets by creating new evaluation tools, such as economic models and indicators,
and by drawing up proposals for an agricultural and international food policy.
A look at the news

Michel Barnier finds speculation on agricultural commodities « outrageous »

13 December 2010



Wednesday 8th December at a press conference on the revision of the Markets in Financial Instruments Directive (MiFID), Michel Barnier, the European commissioner for Financial Services, highlighted the dangers of financial speculation on food prices.

« I find hyper-speculation on agricultural commodities outrageous" he declared, referring to speculation on agricultural commodity derivatives, which have led to sharp price variations. Because if agricultural prices are too volatile, they have a downstream impact on food prices and therefore consumer prices.

It is this frequently recognised link between speculation on futures markets and the volatility of agricultural commodities that Michel Barnier is blaming. Moreover, he declared that speculation is one of the causes for the food crises and famines that have hit poor countries in recent years.

These words stand out from the longstanding doctrine advocated by the Commission and certain experts that speculation would only have a very marginal impact on the volatility of agricultural commodity prices and would only be « residual ». But the financial crisis has changed things and policy makers are becoming aware that this doctrine is limited when explaining recent events.

This is why the European Commission has recently initiated reform measures to regulate financial markets following the example of the United States who have already made progress on this subject. The objective is to make markets "more transparent and better supervised" according to Michel Barnier. The new proposals include:

    - Closer regulation of derivative markets and short sales;
    - The implementation of 27 bank charges in each Member State;
    - More available information on OTC markets
While the French president has recently declared wanting to put agricultural market regulation on the agenda of the next G20 meeting, it is encouraging to see that solid measures are now being looked at and will be soon put in place at European level.
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Paris, 26 April 2019