Pension funds and other institutional investors that have poured billions of pounds into commodity index funds could be unwittingly fuelling a rise in global hunger, says a new report from Christian Aid.
Such investments in indices of commodities bundled together have become increasingly popular in recent years following deregulation and the bursting of the dot.com bubble.
Food price rises led World Bank President Robert Zoellick last month to warn: ”˜We are one shock away from a full blown crisis.’ Cereal prices, which are of crucial importance to the world’s poorest people, hit a record high in recent weeks on the UN Food and Agriculture Organization’s price index. Even with inflation taken into account, the rate was 5.5 points above the previous record in mid-2008, when food riots broke out in more than 30 countries.