Soaring profits for grain-trading companies have led to criticism and calls for a windfall profits tax in the United Kingdom.
The four largest grain-trading firms are Archer-Daniels-Midland, Bunge, Cargill and Louis Dreyfus, known collectively as the ABCD companies. They control an estimated 70% to 90% of the global grain trade among them, and have been reporting record or near-record sales and profits.
Cargill had a 23% increase in revenue in its recently ended fiscal year, while Archer-Daniels-Midland’s last quarter was the most profitable in its history. Sales and profits rose sharply at Bunge and Louis Dreyfuss also.
Some charitable institutions and others say a windfall profits tax would be appropriate. An advisor for the British-based charity Oxfam told The Guardian: “There are fears that speculation could be a driver in food price rises. Anything that causes hunger and starvation is immoral.”
Others, however, say that the ABCD profits are a natural result of a situation where demand for grain is rising while supplies remain constrained. “I don’t think they are acting immorally – they’re not intentionally driving up prices,” a Moody’s analyst told The Guardian.