News in brief: The UN has urged greater oversight of commodity traders, warning that their unregulated activities are exacerbating the global food crisis.
The United Nations (UN) has called for greater oversight of commodity traders, warning that unregulated activity is worsening the global food crisis in the wake of Russia’s invasion of Ukraine.
In a report released on Wednesday, the UN Conference on Trade and Development (UNCTAD) said that commodity traders are circumventing regulations and masquarading as manufacturing companies rather than financial institutions.
Thus, they can engage in profiteering from financial activities, which drives revenues in global food trading but worsens it for consumers.
The report also added that speculative trading in commodity markets is contributing to price volatility and making it more difficult for farmers and consumers to plan and budget.
Rebeca Grynspan, UNCTAD Secretary General noted the importance of greater oversight and regulation of the commodity trading sector, which the food crisis brought to fore. She maintained that unregulated activity in the sector is exacerbating the crisis and making it harder for vulnerable people to get access to food.
The intergovernmental organisation called for a number of measures to improve oversight and regulation of the commodity trading sector such as requiring commodity traders to disclose more information about their activities as well as increasing transparency in commodity markets by making more data available to the public. Other measures it suggested include strengthening the enforcement of existing regulations, and developing new rules to address emerging risks.
