Unrest in Egypt causes spike in wheat prices
As the protests continue in Egypt, the rest of the world prepares for major increases in the price of wheat. Egypt is one of the world's leading importers of wheat, and neighboring countries are putting in big grain orders to feed their people. Scott Tong reports.
TEXT OF STORY
JEREMY HOBSON: Well higher oil prices aren’t the only economic consequence of the unrest in Egypt. Wheat prices are going up, and that’s already having ripple effects across the world.
Marketplace’s Scott Tong tells us why.
SCOTT TONG: Egypt is the world’s leading importer of wheat. The World Bank says 30 million Egyptians are impoverished, and most spend half their income on food. Rising prices have sparked deadly protests in North Africa before. And mindful of Egypt meltdown now, neighboring countries are putting in big grain orders to feed their people.
Dan Basse is president of Ag Resource Company in Chicago.
DAN BASSE: The Algerians are bringing in lots of wheat trying to forestall a situation like that. While in Tunisia we had a president who was ousted over rising food prices to the same degree. Yes in those countries where there’s a very impoverished population, rising food prices does have a play.
Among other grain buyers: Jordan, Libya, Turkey, Qatar, Morocco and Lebanon. In fact, Goldman Sachs now warns global hoarding of rice and wheat “will intensify.”
In fact, some analysts figure that stockpiling, combined with tight global supply, could jack up prices even more.
In Washington, I’m Scott Tong for Marketplace.