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Food Crisis, "Huge Risk of Profiteering" Lead to Call For Grain Windfall Tax

Food Crisis, "Huge Risk of Profiteering" Lead to Call For Grain Windfall Tax

Record profits and lack of transparency, resulting in a "huge risk of profiteering," have led to calls for a grain industry windfall tax.

This amid a global food crisis that has left hundreds of millions of people around the world wondering where their next meal is coming from.

U.K. news outlet The Guardian recently reported on the situation, noting:

The world’s top four grain traders, which have dominated the global grain market for decades – have seen record or near-record profits or sales. They are forecasting demand to outstrip supply at least until 2024, which is likely to lead to even higher sales and profits in the next two years.

Food prices have surged more than 20% this year, according to the UN Food and Agriculture Organisation [Organization]. About 345 million people are experiencing acute food insecurity, according to the World Food Programme [Program], compared with 135 million before the Covid-19 pandemic.

70% to 90% of the international grain industry is controlled by four companies -- the Archer-Daniels-Midland Company, Bunge, Cargill, and Louis Dreyfus,  collectively referred to as ABCD.

The Guardian spoke to Olivier De Schutter, co-chairman of IPES-Food (the International Panel of Experts on Sustainable Food Systems) and a UN special reporter on extreme poverty. 

De Schutter said, “Global grain markets are even more concentrated than energy markets and even less transparent, so there is a huge risk of profiteering."

The human rights expert also expressed that the grain giants offered "insufficient transparency" regarding how much grain they have available, specifically stating, “We need to be looking at the grain giants and asking what they could have done to avert the crisis, and what they could be doing now."

Another recent article noted that a windfall tax on industries like grain, fossil fuels, and pharmaceuticals could aid in solving the "unprecedented" food crisis that is impacting families in underdeveloped nations around the world. 

The Horn of Africa, Yemen, and Afghanistan are reportedly facing the biggest crisis, due in large part to issues that stem from the COVID-19 pandemic, which ravaged these regions. 

Per that report:

A windfall tax of 90 percent on the excess profits globally would yield about $490 billion that could be used to solve the food crisis, which is heading to “catastrophic levels” for hundreds of millions of people, and set the world on the path to a sustainable food system, said Gabriela Bucher, executive director of Oxfam International.

While it remains to be seen if first-world nations like the United States, England, and the rest of Western Europe will impose a windfall tax on grain companies, leading experts are becoming increasingly vocal about the necessity of this measure. 

What do you think? Should ABCD pay a windfall tax?

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