There was lots of excitement in the media over the last week, with cocoa prices briefly hitting a 33-year high after a single buyer cornered the market, purchasing and taking delivery of 240,100 tonnes of cocoa.
That’s £658 million worth of cocoa beans, representing around 7% of the world’s annual production of cocoa, or 15% of current global stocks.
The buyer is a hedge fund called Armajaro Holdings, headed up by multi-millionaire Anthony Ward. The fact that Mr Ward has actually taken delivery of the beans suggests that he is stockpiling them, betting on future cocoa shortages with the hope of selling them on for a whopping profit.
There was a disappointing three-day UN World Food Summit in Rome earlier this week. Given that around a billion people are malnourished and suffering the effects of high global food prices, the summit could have been a great opportunity for rich countries to pull together and make real commitments to eradicate world hunger.
Instead, Silvio Berlusconi was the only G8 country leader who even bothered to attend the summit. The director general of the Food and Agriculture Organisation, Jacques Diouf, made headlines when he expressed disappointment at the outcome of the summit, and criticised rich countries for managing to mobilise trillions of dollars to combat the financial crisis while neglecting to tackle food security.
It is disappointing because in July this year G8 leaders pledged to put £12bn into boosting sustainable agriculture in poor countries, and now that money is failing to materialise. Agricultural development aid seems to be falling by the wayside once more.
Yet, small-scale, sustainable agriculture is the future. Investing in smallholder farming will not only support the two billion people who depend directly upon it, it is our best chance of feeding the rest of us in the long term.