There are growing calls for a windfall tax to be imposed on grain trading companies who profiteered amid soaring food prices around the world, following the Russian-Ukraine war.
The International Panel of Experts on Sustainable Food Systems (IPES-Food) has claimed that the world’s top four grain traders, which have dominated the global grain market for decades, have witnessed record or near-record profits or sales, reports The Guardian.
The group is forecasting that demand outstripping supply would remain until 2024, leading to higher sales and profits in the next two years and keeping the grains beyond the reach of the poor, the report added.
“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,” Olivier De Schutter, a co-chair of IPES-Food and UN special rapporteur on extreme poverty and human rights, was quoted as saying.
The four trading companies that are said to have profiteered are— the Archer-Daniels-Midland Company, Bunge, Cargill and Louis Dreyfus.
These companies, known collectively as ABCD, control an estimate of 70 to 90 per cent of the global grain trade, the UK-based news outlet said.
“Global grain markets are even more concentrated than energy markets and even less transparent, so there is a huge risk of profiteering,” De Schutte was quoted as saying.
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Cargill saw a 23 per cent increase in revenues to a record $165bn (£140bn) for the year ended 31 May, whereas Archer-Daniels-Midland reported the highest profits in the second quarter of the year.
Bunge’s sales surged by 17 per cent year on year in the second quarter, and Louis Dreyfus recorded profits for 2021 up by more than 80 per cent on the previous year, The Guardian reported.
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According to the UN Food and Agriculture Organisation, food prices have soared more than 20 per cent this year.
It said that about 345 million people are experiencing acute food insecurity, compared with 135 million before the COVID-19 pandemic.
(With inputs from agencies)
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