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Tags: g-20 | crop | food | price

G-20 to Wait for US Crop Report before Food Price Action

Tuesday, 28 August 2012 08:10 AM EDT

G-20 nations taking stock of the third global food price surge in four years will wait for September's crop report from the U.S. Department of Agriculture before deciding whether to take joint action on the issue, France's farm minister said on Tuesday.

Senior officials held a conference call on Monday on rising prices after drought in the United states and poor crops from Russia and the Black Sea bread basket stirred new fears about food supply and inflation.

"There will be a communication at the end of September. I will wait for the results given by the United States around Sept. 12 on the latest estimates for corn supplies," French Agriculture and Food Minister Stephane Le Foll told BFM TV.

The decision to wait for the USDA report was taken at a conference call between senior officials of France, the United |States and G-20 president Mexico on Monday. Representatives from the United Nation's Food and Agriculture Organisation (FAO) and the World Bank were also on the call, the minister's spokesman said.

The head of the FAO called the G-20 on Monday for coordinated action to ease worries about food prices.

France, which currently presides over the G-20 agriculture body had initially said a decision would be based on a report by the Agricultural Market Information System (AMIS), created by the G-20 last year, also due in mid-September.



If G-20 leaders decide the situation needed international intervention, France could trigger an emergency meeting of the so-called Rapid Response Forum created by the G-20 last year to deal with surging world prices.

However, its main tool would be limited to talks to avoid unilateral trade restrictions by large producing countries that could lead to surge in prices, such as the one seen after Russia banned exports after a drought slashed its crops in 2010.

Le Foll also blamed speculation for the surge in prices and reiterated calls for taxes on financial transactions.

"There have been transfers, speculators leaving other markets to come to food markets. We need to stop this," he said.

"We need to tax financial transactions in any case," he said, also calling for position limits on derivative markets.

France had already called for similar moves when negotiating over G-20 agriculture last year but G-20 members had failed to reach an agreement.

At EU level, however, the executive has proposed a bloc-wide tax on financial transactions including stocks, bonds and derivatives from January 2014.

French President Francois Hollande was due to meet the head of the country's largest farm union FNSEA later on Tuesday. Top of the agenda will be the surge in farm commodities prices and tools to combat it, a spokeswoman said.

© 2023 Thomson/Reuters. All rights reserved.

Tuesday, 28 August 2012 08:10 AM
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