« Speculation on commodities today has taken on disproportionate dimensions. The most recent example is the purchase last week on the London Liffe branch of the New York Stock Exchange (NYSE), of nearly 240.000 tons of cocoa, equal to 7 % of world cocoa production, or an estimated 15% of world stocks and 25 % of European ones !
According to The Wall Street Journal, the fund has paid nearly one billion dollars for this purchase, the biggest cocoa bean delivery on the market in 14 years.
The fund is said to have made its bid through various commodity trading companies and banks, the BNP Paribas allegedly financing 102.450 tonnes. As can be seen from the upheaval on the cocoa market since last week, the operation is a success, the rate quoted in the July contract, which expired on July 15th, reached as far as 2727 £ / ton, a record high since September 1977.  » (Le Figaro 23 July 2010 )

« Amajaro tries to bleed us by asking us to the higher price » was the exasperated remark of a London trader in the Wednesday issue of The Wall Street Journal. For the time being Amajaro has not wished to comment.

The criticism comes from two fronts. The first is those who do not want to pay a higher price for cocoa beans. They find that Mr Chocolate has gone too far, but recognise that he has not done anything illegal.They side with the NYSE Liffe, which stated in a message to traders: " Even though we duly note your remarks on volatility, our investigations have not come up with any evidence of illicit operation or market agent trying to distort the price of the July contract. "

Other critical voices are more radical. Among them are those who, at this juncture, point out that the banks have generated not only the increase of the price of cocoa, but also of coffee and bread and will do the same any day (as already in the recent past) with maize and rice! The World Development Movement estimates that last year Goldman Sachs made a 1 billion dollar profit on commodity speculation.

That is why « this massive purchase, although legal, triggers anew the debate on stricter rules on commodity transactions. In April last year Christine Lagarde caused a general stir by demanding the setting up of a European agency for supervising the financial market. Last Wednesday the American president Barack Obama, who has proclaimed the most comprehensive reform of the financial system, was determined to have a limit on commodity speculation included in the new legislation » (Le Figaro, July 23rd 2010, same article as above).
The World Development Movement is asking champions of international solidarity to send out a complaint against banks which take part in speculation on food stuffs by writing to the FSA, the Financial Services Authority, 25 The North Colonnade, Canary Wharf, London E14 5HS, United Kingdom; web site www.fsa.gov.uk).

Our friends of Peuples Solidaires should, I think, take similar action, as they have proven well capable of in the past, and ask members of their network to write to Christine Lagarde and/or to the President of the European Commission, demanding the introduction of a financial regulation that puts and end to speculation on food stuffs.

Adam Smith once said: " The speculator is an individual who, in any circumstance, sets his personal blind interest first, in total disdain for humankind. " Therefore, we must stop the speculation on hunger in the world.

Koudougou, July 26th 2010
Maurice Oudet
Director, SEDELAN