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This is advertorial Shaheed Mahomet

The establishment of the World Trade Organisation (WTO) in 1995 forced lower trade barriers, especially for food.

The result has been the unprecedented spread of multinationals to seize substantial parts of the world food resources.

Today 80% of the land worldwide that produces food for export is in the hands of multinationals. US multinational Monsanto controls 41% of world maize production and 25% of the soybean market. The objective basis for speculation over food prices by the banks has thus been achieved.

When a sector is controlled by a few companies, then we may say that an oligopoly exists when these companies act together in order to raise prices and thus profits. (www.oligopoly.com ).

The US and EU banks are now acting as an oligopoly in the world food sector. Barclays, Barings (before it went bankrupt) and the Rothschilds are major investors in Monsanto. Monsanto controls 500 000 hectares of maize production in South Africa. They act as a local partner of the maize oligopoly with Tongaat Hulett (Anglo American).

Despite there being a surplus of maize, the price has doubled over the past two years. Exxon Mobil, BP, Shell, Chevron, Total, are in effect acting as the main oligopoly for oil. The Wall Street Journal reports that about 70% of all benchmark crude traded on the New York Mercantile Exchange is controlled by speculators.

The resulting super-profits for the banks such as Barclays (the biggest single investor in the world's largest oil company) may be seen in the balance sheet of Exxon Mobil which reflects payments of dividends every three months of 25% in 2003, increasing to 35% in 2008.

The oligopolies often buy up local brands. They appear as local companies and thus disguise their imperialist nature. Thus the same product may go under different brand names in various countries- eg Cheese Whiz in Venezuela, Miracle Whip in Germany, Philadephia Cream Cheese in Singapore, etc.

Tiger Brands, for example, is controlled by major financial institutions such as SSB, State Street, JP Morgan Chase, Old Mutual and Liberty. Premier foods is controlled by Old Mutual, while Foodcorp has a substantial shareholding held by the Bank of New York and JP Morgan Chase. Together, these companies control over 56% of the local wheat market. Our daily bread is in the hands of the speculative activities of these banks.

The impression has long been created of there being a local banking sector whereas in reality all 'local' banks are controlled via extensive shareholdings held by the major banks. The SA Reserve bank has always been privately owned. Its shareholders include JP Morgan Chase.

Despite the repeated statements by agents of the IMF and the UN about a supposed shortage of food and oil, there is sufficient evidence to the contrary.

Food Technology has become so advanced that the cost of production has fallen dramatically over the years. A US Congressional Research Report in April this year puts the cost of producing the contents of a box of cereal at 3,3 US cents (less than 25 cents in South African currency).

This would ordinarily mean that prices of boxed cereal would fall. The only way to keep them up (and profits along with it) is through artificial means. This is where the US and EU subsidy system comes in.

The biggest annual subsidy in the US is called the Direct and Countercyclical programme. Over $20 billion dollars has been given from 2002 to 2006 to farmers not to produce anything. This is to create an artificial scarcity so that prices can be kept artificially high. The EU also has a subsidy programme that allows massive tracts of land to be taken out of production, for the same reason.

As far back as 1991 a US Congressional oversight committee lifted the limits on the extent to which the Wall Street banks can gain from speculation from hedge fund activities. Since then the amount of funds that are being controlled by the banks, through hedge funds amount to $516 trillion - this is ten times the world GDP.

Speculators who operate at the Chicago Commodity Exchange (this is the main exchange that sets world food prices) say that prices do not have any relation to supply and demand and are grossly over-inflated.

Hedge fund speculators bet on prices going up; Sometimes farmers would sell their next year's crop as a means of gaining operating capital. What banks have done through the hedge funds is that they have gained control of the food crop, oil production, mineral production, equivalent to ten years of world GDP.

The new speculators would buy up, say, next year's crop at a low price from the farmer. They would then bet on the price rising and then resell the crop at a higher price. The next speculator would buy up the same crop at a higher price and then resell it at an even higher level, and so it would go on. At all stages the price has no relation to the actual cost of the crop or even if it is planted at all.

Virtually all major banks have opened up access to Commodity Index funds, whose sole purpose is to speculate on commodities. Unlike previous financial instruments, these hedge fund prices are not related to actual production and have no limits.

There are about 50 000 commercial farmers in South Africa that produce over 95% of the local food production. All these commercial farmers are directly or indirectly dependent on the above 5 monopolies and thus the major international banks.

Many farm workers are still earning between R100 and R1000 per month. It is clear that farm workers are not benefiting from the current high food prices.

There have been heroic uprisings against high food and fuel prices around the globe. What is immediately needed, however, is a general rise in wages, a general reduction in the hours of work to give jobs to the unemployed and an end to speculation on commodities.

Recognising that the working class leadership are largely co-opted, workers needed to mobilise beyond the scale of the international general strike on 1 May in 1886, which won the 8-hour day.