News

November 02, 2008

That Was The Week That Was … In Grains And Alternative Fuel Commodities

By Sally White

Speculators are still under fire in the US for playing a part in driving up food and energy prices, but less so now in the UK. This despite the way commodity futures have collapsed as the financial crisis drives the unwinding of derivative positions. The Treasury Select Committee said last week that it did not intend to investigate the role of speculators at this stage, but in the US politicians are renewing efforts to scrutinise futures markets and their influence on commodity prices.

Not all MPs accept the official line that the soaring prices of the last two years were down to fundamental supply demand imbalances. Nick Ainge, Labour MP for Carmarthen West & South Pembrokeshire is one. As far as he is concerned the UK will still take proper look at the situation “We’re still planning to have a hearing in the New Year. I was assured, when I raised it, that we would look at it again.”

It’s now not just futures markets that are feeling the effects of the financial crisis....