Carlsberg’s CEO has used an interview to criticise hedge funds for artificially increasing the cost of raw materials as concerns grow about food commodity prices.
Poor harvests in some major grain-producing countries in 2010 are threatening to increase costs for brewers this year. But, the situation has been exacerbated by several “speculators”, Carlsberg’s Jorgen Buhl Rasmussen told the Daily Telegraph newspaper in an interview published today (10 January).
“Some of the hedge funds, especially those short-selling, I do not see as contributing to value-creation,” he told the paper, adding that authorities should look at regulation in the sector.
Carlsberg warned in November that it will be forced to raise beer prices in most of its markets in 2011 due to higher-than-expected barley costs. The Denmark-based brewer’s strong position in Russia, where grain shortages are particularly acute, means it is more exposed to cost rises than its rivals.
Food commodity prices in general have risen sharply in the last six months, due to a mixture of poor harvests and rising global demand. Commodity prices in the United Nations’ global food index reached record highs in December, the body’s Food & Agriculture Organisation said last week.
Despite the well-publicised fears about grain costs, sugar has been the biggest climber on the UN index, having doubled in price since April last year.