Hungry Capital

Hungry Capital

The Financialization of Food

A compelling analysis of how global finance is devouring the food system and gambling with our future in the process.


Over the past thirty years, the ability of global finance to affect aspects of everyday life has been increasing at an unprecedented rate. The world of food bears vivid testimony to this tendency, through the scars opened by the 2008 world food price crisis, the iron fist of retailing giants that occupy the supply chain and the unsustainable ecological footprint left behind by global production networks.
Hungry Capital offers a rigorous analysis of the influence that financial imperatives exert on the food economy at different levels: from the direct use of edible commodities as an object of speculation to the complex food chains set up by manufacturers and supermarkets. It argues that the circular compulsion to build profits upon profits that global finance injects into the world of food restructures the basic nurturing relationship between man and nature into a streamlined process from which value has to be mined. The end result is a monstrous Leviathan that holds together while – at every step – risks to crumble.


In ‘Hungry Capital’, Luigi Russi considers the relationship between food production, consumption and finance in a short but interesting, revelatory but not revolutionary, and original but somewhat disconnected book. The metaphor of Hobbes’s leviathan is adopted to set the scene, situating capitalism as the monster being precariously held together by the fragile and contradictory relations it creates. This topical book seeks specifically to examine how ‘an unstable financial system is projected onto the world of food, while the increased fragility of the food economy feeds in turn the very chaotic features of the financial system’ (4-5). Russi organises chapters into key themes, beginning with a more general overview of the complexities of the financial system (chapter 2), followed by consideration of the evolution of the financialisation of food (chapters 3-5) and finally providing two case studies, looking at the influence of land grabs and the corporatisation of coffee production and distribution (chapters 6 and 7). In his Conclusion, Russi offers the idea of a paradigm shift as a possible solution to the challenges of reinventing the food economy and suggests that ‘innovative agency deployed from within and without the system may act as a counterpoint to the existing expansionist tendencies of the financialised economy’ (103). However, although Russi has the desire to tell a ‘new story of food as co-production’ (103), the book fails to promote a clear way forward, offering only minimal insight into how innovation and active responses against the capitalist system of food production may take shape in practice. Chapter two presents an analysis of the ‘black box’ (6) of finance, beginning by reflecting on endogenous influences which effect the ‘patterns of relations’ (8) in the financial system. These relations are consistently rebalancing and shifting in a contradictory way in order to counterbalance possibilities for entropy whilst, concomitantly encouraging ‘unsustainable growth’ (19) and therefore contributing towards entropy. Such are the ‘self-reinforcing dynamics’ (17) of the financial market, which leads to the systemic regulation of society’s actions, in terms of not just what we consume through food, but also where we invest capital. Here Russi builds in the development of derivatives: market traded vehicles whose apparent ‘value’ is derived from an underlying asset, be it real estate, commodities or food. However, there is often disconnection between the pricing of the derivatives and the assets themselves, due to market sentiment and pricing driven by trading, with financial speculation increasing the drive towards profit maximisation. Russi demonstrates how the financial market is riven with ‘glitches’ (30), which results in trickle down effects from trading being acutely felt in the food markets, as they become ‘financialised’. The financialisation of food and the consequences it brings is discussed more fully in chapter three, through three ‘food regimes’ (33). These regimes chart the progressive absorption of food into the capitalist system, from the first regime (where food production was localised and trading colonialised), through to the second regime post World Wars, where the state influence was paramount in the promotion of the ‘comprehensive industrialisation of agriculture, with a view to maximising food production’ (35) via processing chains and substitutionism (e.g. providing ‘alternative’ synthetic goods, such as margarine in place of butter). The third regime was stimulated by collapse of the Bretton Woods system and the third world debt crisis, leading to the increasing involvement of international bodies in regulating the food systems at work, whilst financial liberalisation and globalisation led to market monopolies of food suppliers squeezing the producers. The latter situation has been marked by increased control of the food industry by transnational corporations (TNCs) as they adopt an almost imperial approach to production, as well as the simultaneous adoption of food into the financial markets through commodity speculation and indices (as detailed in chapter 4). The shift away from the autonomous ‘peasant condition’ of farming (54) into an engineered and profit driven entity, has led to our current position, where exploitative social and catastrophic environmental impacts have become inevitable under the ‘pervasive economisation of the food system’ (61). Coffee production and land grabs are the two case studies presented in chapters 6 and 7, both of which are criticised as neoliberal and unsustainable, especially in developing economies. The food production system today epitomises how finance and profit are prioritised over society’s wellbeing and ecological soundness. The dynamics of food production demonstrate the indifference of financialisation to the inequalities it exacerbates, through coffee fuelled speculation (75) or the destruction of land for the production of jatropha (87). Each of these case studies provide incisive insight into the precarious financialisation of food and help to demonstrate key points previously made in earlier chapters. The concept and content of the book is ambitious and interesting, but for me, the organisation and presentation of information, resulted in a disjointed and interrupted reading experience. Russi has covered a lot of research ground here and attempted to unravel and simplify the intricacies of food systems under capitalism, for which he is to be lauded. However, due to the organisation of this book, a wide variety of seemingly distinct yet related topics are analysed in some detail independently of each other, then reflected on in the final conclusion. But, there are few explicit links and connections provided for the reader in between chapters, which make for a frustrating examination of an inherently problematic and worrying phenomenon. There is no debating the contemporary relevance and importance of this book, and Russi succeeds on many levels in revealing the mutually destructive and profitable alliances between transnational food corporations and producers (chapter 5), introducing key ideas on financial speculation (chapter 4) and derivatives (chapter 2), emphasising the drive towards profit maximisation, irrespective of the resulting marginalisation of producers and demonstrating the system’s lack of concern for more-than-economic costs (chapter 6). The destruction of the environment and the consequences for us, as the human race are further exposed (chapter 7). Indeed Russi introduces us to a wide variety of issues from which many further opportunities for discussions emerge. All in all, although this book concludes by suggesting a necessary paradigm shift and considers how smaller acts of resistance can be accumulated and amplified, it doesn’t do enough to answer the question of how the food system itself can be radically altered. Hungry Capital opens up perspectives for additional investigation. It is less of an answer and more of an emerging question over what can be done from the perspective of the left to further understand and effectively respond to the destructive social relations being created by the financialisation of food. ~ Nicola Livingstone, Marx & Philosophy Review of Books

Luigi Russi takes up an issue that will dominate the lives of people everywhere in the coming years: the adequacy and safety of our food. He brings insights from the worlds of finance, legal sociology and political economy to link processes of global capitalism with the appalling persistence and increase of hunger and malnutrition. A must read. ~ Jayati Ghosh, Professor of Economics, Jawaharlal Nehru University

This is a thought-provoking book on the food industries and how these are entangled with the world of finance. It is theoretically well grounded, original and rich in empirical detail. It is an important contribution to the international debate on the future of agriculture. ~ Jan Douwe van der Ploeg, Professor in Transition Studies, Wageningen University

Russi issues a stark warning, as he identifies how the drive for profits and the deregulation of commodity trading are re-shaping the business strategies of the large corporations who procure, broker and reassemble our food. The result is the acceleration of the ecological crises facing the food supply. ~ David Barling, Reader in Food Policy, City University London and co-author of Food Policy: Integrating Health, Environment and Society

At a time when finance and food are the epicentre of global crises, Luigi Russi's study provides a unique insight into the dynamics driving these complex but critical chains of human economic interaction. A must read for anyone analysing complex socio-economic processes and the potential for social progress. ~ Anastasia Nesvetailova, Reader in International Political Economy, City University London and author of Financial Alchemy in Crisis: The Great Liquidity Illusion

Luigi Russi has made a significant contribution to the unpicking of the relationship between finance and food by opening up for scrutiny the powerful and uncontrolled forces operating in this obscure and complex trading system, which has only just been recognised as giving rise to a crisis which is as potentially damaging as the failure to maintain control of the world's banking industry. ~ Peter Robbins, Author of Stolen Fruit: The Tropical Commodities Disaster

Hungry Capital provides a timely and novel analysis of the new frontier of financial capitalism. ~ Ole Bjerg, Associate Professor, Department of Management, Politics and Philosophy, Copenhagen Business School

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