Glencore: profiteering from hunger

Veröffentlicht: Mai 10, 2011 in Uncategorized

gefunden auf Al Jazeera 

The rapid rise in prices for food, fuel and commodities has been disastrous for the world’s poor, including Indonesian market vendor Lia Romi. But it’s a bonanza for multinational trading firms such as Glencore.

While Romi has trouble feeding her family, Glencore – the world’s largest diversified commodities trader – is planning a US$11billion share sale, likely the largest market debut ever seen on the London Stock Exchange.

„The price for our daily food has at least doubled in the past two years,“ Lia Romi told Al Jazeera through a translator. „Food costs 100 per cent of my family’s daily income [of about $3]. I have nothing saved and I owe [money] from my [market stall] business.“

While Romi, and millions like her, worry about feeding their families, the initial public offering from the commodity speculating giant will create at least four billionaires, dozens worth more than $100million and several hundred old fashioned millionaires. Chief Executive Ivan Glasenberg is set to make more than $9bn from the share sale. Andspeculating on food prices is an important part of his wealth.

Controlling prices

Valued at about $60billion, Glencore controls 50 per cent of the global copper market, 60 per cent of zinc, 38 per cent in alumina, 28 per cent of thermal coal, 45 per cent of lead and almost 10 per cent of the world’s wheat – according to information the firm disclosed prior to its share sale. It also controls about one quarter of the world market in barley, sunflower and rape seed.

„They are possibly one of very few mining companies that are price makers, rather than price takers,“ said Chris Hinde, editorial director of Mining Journal magazine. „They are the stockbrokers of the commodities business [operating] in a fairly secretive world. They are effectively setting the price for some very important commodities,“ he told Al Jazeera.

The firm employs about 57,000 people, generated a turnover of $145billion in the past year and has assets worth more than $79billion. Glencore’s media department refused interview requests from Al Jazeera.

„Glencore’s vertical integration really is unprecedented,“ said Devlin Kuyek, a researcher with GRAIN, a non-profit international organisation working on food security.Based in Baar, Switzerland, where regulation is minimal, the company’s sprawling interests span Bolivian tin mines, Angolan oil, zinc producers in Kazakhstan, Zambian copper mines and Russian wheat operations.

„Glencore owns almost 300,000 hectares of farm land and it is one of the largest farm operators in the world. They are engaging in speculation on the grain trade and have immense market power,“ he told Al Jazeera.

Global food prices have climbed recently, returning close to their 2008 peak, when bread riots swept parts of the Middle EastAfrica and the Caribbean.

„A disturbing amount of price increases, I fear, is being driven by speculative activity,“ Marcus Miller, a professor of international economics at the University of Warwick, told Al Jazeera. „Bets [on future price rises or declines] can become self-fulfilling if you are big enough to affect the market …

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