This post was published by Oxfam International on August 3, 2012.
3 August, 2012—The world’s largest commodity traders are a powerful, unique and poorly understood sector. The major traders, Archer Daniels Midland (ADM), Bunge, Cargill and Louis Dreyfus, collectively known as the ABCD traders, share a significant presence in a range of basic commodities, controlling, for example, as much as 90 per cent of the global grain trade. Other emerging market trading companies such as Olam, Sinar Mas and Wilmar are also quickly establishing a global presence.
The major traders do not just trade physical commodities – they operate from the farm level all the way to food manufacturing. They provide seed, fertilizer and agrochemicals to growers, and buy agricultural outputs and store them in their own facilities. They act as landowners, cattle and poultry producers, food processers, transportation providers, biofuel producers and providers of financial services in commodity markets. Traders have been integral to the transformation of food production into a complex, globalized and ‘financialized’ business. Food prices, access to scarce resources like land and water, climate change and food security are all affected by the activities of traders.
As traders continue to exert a great deal of influence over the global food system, they should be held accountable to be responsible actors. Traders are a central node in the food system, within which large-scale change is necessary in order to ensure that everyone has enough to eat – today and in the future. Yet notwithstanding the vast breadth of traders’ influence and activities, there is currently limited public information about the traders and their operations.
Our research report “Cereal Secrets: The world’s largest grain traders and global agriculture” provides an analysis of the role and impacts of the world’s largest commodity traders on the modern food system. The report was commissioned to support GROW, Oxfam’s global campaign to deliver food security in a resource-constrained world. The campaign, launched in 44 countries over the last year, urges governments, companies and civil society to repair the world’s broken food system, which leaves nearly one billion people hungry every night, including millions of small-scale farmers and workers who produce much of the world’s food.
We hope this report contributes to the increased accountability and transparency of traders, and furthers an urgent dialogue on making the global food system work for all.