May 27, 2013 / 10:26 AM / in 6 years

Germany's DZ Bank to end food commodity speculation

* DZ Bank to end food commodity trade this year

* German government welcomes decision

HAMBURG, May 27 (Reuters) - Germany’s DZ Bank is to end speculation in food commodities, following a move taken by several other German banks, a letter from the bank showed on Monday.

The move was announced by DZ Bank director Lars Hille in a letter to German pressure group Foodwatch seen by Reuters on Monday.

Groups such as Oxfam and Foodwatch have said such trading is responsible for pushing up international food prices and exacerbating famine in poor countries.

A series of other German banks, including Commerzbank , DekaBank and Landesbank Baden-Wurttemberg, have stopped trading in agricultural commodities in the past year.

DZ Bank’s letter said there is currently no demand for food commodity investments in Germany and the banking group, including leading German investment company Union Investment, has decided to withdraw from trading in food commodities and will not renew its trading positions in 2013.

German Agriculture Minister Ilse Aigner has repeatedly expressed concern that outside financial investment in agricultural commodity markets causes higher prices, especially for the Third World.

The ministry said on Monday that the DZ Bank decision “is welcomed and sets a clear signal”.

Germany’s Deutsche Bank said in January that it would to continue dealing in food commodities because there was no conclusive evidence to prove that speculators are responsible for rising prices of agricultural products. (Reporting by Kathrin Jones, writing by Michael Hogan; Editing by David Goodman)

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