G20 agriculture ministers considered French proposals to tighten regulation of commodity markets and set up emergency reserves as they gathered on Wednesday for a first-ever summit that aims to tackle rising food prices.
Paris has made tougher commodity trading rules a priority of its 2011 presidency of the Group of 20 leading economies. President Nicolas Sarkozy has blamed speculators for food price inflation. But it faces opposition to stringent market rules from Britain and Brazil, as well as reluctance from the likes of China and India to share farm data.
A draft communique showed the farm ministers could end up with a watered-down deal limiting decisions to agricultural issues, mainly data or food supplies, not financial markets."I prefer to take responsibility for a failure rather than a half-hearted agreement or an agreement for appearance's sake," French agriculture minister Bruno Le Maire said. He warned that a failure to adopt concrete measures to tame surging staple food prices before the summit concludes on Thursday could give way to more riots.
Surging demand for food and fuel will maintain inflationary pressure on commodities this decade, international bodies warned last week.
Benchmark international wheat prices are up about 50% in the past 12 months alone, while corn prices have doubled.
While all G20 nations have agreed that steps must be taken to tackle surging food prices, they are split over whether prices should be tamed by regulation or by increased agricultural production. China considers, as does India, that giving exhaustive and timely data on stocks would be difficult for practical reasons.