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Deutsche Bank reduces 'hunger trade'

The Local · 21 Mar 2012, 09:25

Published: 21 Mar 2012 09:25 GMT+01:00

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"We recognise that the proper functioning of agricultural markets (has) wide social ramifications," the bank said in its annual social responsibility report.

It said it was "concerned by the growing number of people who find themselves in food poverty."

Activists have been protesting against "commodity index funds" by Deutsche Bank and Goldman Sachs saying they are key culprits in the volatility of food prices around the world.

Other German banks known to bet on food prices are Commerzbank and, to a lesser extent, Sparkasse.

The funds enable banks to effectively bet on the development of food prices - and are held responsible for the sharp rise in food prices since 2008.

Deutsche Bank said on Tuesday it would not launch investment products this year dealing in staple food commodities and look more closely at any link with increased hunger.

In response to Deutsche Bank's announcement, Matthias Wolfschmidt, deputy director of the German NGO Foodwatch, called on the bank to renounce its existing food community products and pledge a lasting ban.

The group of 20 industrial and developing nations pledged last year to take action on rampant food price inflation and curb the influence of speculative investors.

"We agree with international policy makers that transparency in agricultural commodity derivatives markets should be enhanced and measures to avoid misconduct strengthened," Deutsche Bank said in its report.

Story continues below…

But it argued that other factors were also behind rising prices of crucial staples including growing demand, trade restrictions and state subsidies.


The Local (news@thelocal.de)

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Your comments about this article

11:42 March 21, 2012 by lucksi
"trade in staple foods was linked to higher food prices"

OMG, who could have ever guessed that? I wonder if the trade in oil is linked to higher gas prices? Or the trade in all raw materials that the banks make billions and billions on is somehow responsible for higher raw material cost.

If only we knew for certain, oh what a world that would be, because banks and fonds will surely stop this kind of trading because we all suffer from it, right?
11:47 March 21, 2012 by wood artist
Goldman Sachs won't be involved in anything that remotely includes the idea of ethics, so they certainly aren't going to make any changes...unless they think there's more money to be made. Of course, they might take their usual stance and try to sell you on the idea, while betting their own money against you. Ethics? They don't even know the word exists, and whatever it means it certainly can't possibly apply to them.

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