Marker rules needed to prevent food riots: French minister

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Better regulation of global commodity markets is needed to reduce price volatility and prevent new food riots, the French agricultural minister said Friday after meeting with representatives of the Chicago Mercantile Exchange.

Bruno Le Maire flew to Chicago after "very good" meetings in Washington Thursday with his US counterpart, Agriculture Secretary Tom Vilsack, and representatives from the World Trade Organization.

"Everybody recognizes that price volatility and the lack of regulation in the food sector is a strategic issue -- it is not only an economic issue," Le Maire told AFP.

Le Maire expressed confidence that France's proposals to "better organize" commodity markets could lead to "ambitious and concrete decisions" at a G20 meeting next spring.

"We need decisions, we don't need discussions," he said. "We really think that we run the risk of having destabilization in many countries if we don't find a solution to this issue of price volatility and the lack of organization of the food market."

The proposal aims to increase transparency in markets, strengthen the "integrity" of markets and increase coordination among Group of 20 members when it comes to food stocks.

Volatility could be decreased with more transparency about global production and the size of strategic stocks, he said.

Global markets must also be better organized in line with recent changes in the United States which resulted in standardized contracts and better identification of operators, he said.

Le Maire also hopes to reduce the impact of privately negotiated "over the counter" contracts which are transacted off the exchanges and to define position limits in order to help to stabilize markets.

© 2010 AFP

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