The New Egypt

Unrest in Egypt causes spike in wheat prices

Scott Tong Feb 1, 2011
HTML EMBED:
COPY
The New Egypt

Unrest in Egypt causes spike in wheat prices

Scott Tong Feb 1, 2011
HTML EMBED:
COPY

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.

We’re here to help you navigate this changed world and economy.

Our mission at Marketplace is to raise the economic intelligence of the country. It’s a tough task, but it’s never been more important.

In the past year, we’ve seen record unemployment, stimulus bills, and reddit users influencing the stock market. Marketplace helps you understand it all, will fact-based, approachable, and unbiased reporting.

Generous support from listeners and readers is what powers our nonprofit news—and your donation today will help provide this essential service. For just $5/month, you can sustain independent journalism that keeps you and thousands of others informed.