On 22 March, the U.S. Agriculture Secretary Tom Vilsack spoke on the recent surge in food prices in the columns of the British daily Financial Times. As the agricultural G20 approaches, the American counterpart of Bruno Le Maire is now sharing his views on the solutions to help stabilize agricultural markets.
According to him, the first major priority, if we want to fight against the volatility of agricultural commodities, is to improve transparency in all markets: “States should exchange information on stocks and production”, he said, taking up the position that Nicolas Sarkozy has supported since the beginning of the year.
For this system to be truly effective, Tom Vilsack also believes that international cooperation must be strengthened: “To prepare for this, a concerted effort must be made: the private sector, governments and multilateral institutions must work together to improve transparency and the availability of information on the state of agricultural markets”.
With only a few weeks to the G20 agricultural meeting, the words of the U.S. Secretary of Agriculture are very encouraging. However, we must not forget that if we want this to be effective, we also need to act on financialized markets, including OTC markets where the majority of agricultural commodities are traded. Even if the international community shares this idea, its practical implementation is currently unclear, and the United States’ example shows that Wall Street continues to drag its feet regarding the regulation of financial markets1. Let’s hope that all the other G20 countries will adopt a common position to apply a monitoring system in both physical and financial markets.