Speculation about causes

High food prices have made the rise of agricultural commodity prices a politically controversial issue. One of the most controversial elements has been the role of investors, particularly hedge funds, in futures markets, which have been blamed for high prices by some observers.

Feast and famine as food prices soar

Emission control’s neglected area

Getting microfinance to the farmers

Although there have been isolated incidents of market manipulation in commodity futures markets, such as Amaranth’s ill-fated activities in the US natural gas market in 2007, investors and hedge funds are less significant players than many believe. A study by Barclays Capital in July found that the amount being invested in commodity markets was greatly exaggerated, and a recent study by consultancy Celent found that hedge funds account for only 10% to 20% of transactions, far less than investment banks.

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