ZEF Policy Brief “Speculation risks in food commodity markets in the context of the 2022 price spikes ‐ Implications for policy”

by Lukas Kornher, Joachim von Braun, and Bernardina Algieri, Center for Development Research, University of Bonn

In the context of the current food systems disruption due to Covid and Russian war in Ukraine, the share of speculative market activity in agricultural commodities has already increased since the end of 2020.

When market uncertainties remain high or increase due to war, discretionary trade policies, and climate shocks, this also increases the risk that excessive food speculation will further soar prices.

A mix of policy instruments should be considered that include: information and diagnostics, coordinated trade and stock release policies, strengthened regulation of food commodity futures, encouraging voluntary non-speculative behavior, and investment in de-risking food systems.

» Download ZEF Policy Brief no. 40