One question has troubled me about the current unrest roiling the Middle East. Why now? Why did the current crisis erupt at this time? The answers being given by the media seem to be a mixture of a spontaneous desire for democracy coupled with rampant unemployment. While both are probably part of the equation, I suspect there are other factors as well. And one of these might be the rise in commodity prices--especially food.
Earlier this month, Bloomberg reported on a United States Department of Agriculture forecast that global wheat use will exceed production by 19.4 million tons. Similar deficits were also forecast for corn and soybeans. Other commodities, like sugar and cotton, have doubled in price over the past year. And during the last 12 months serious food price increases (and in some cases, food shortages) were reported in Algeria, Iran, Egypt, Jordan, and Syria.
Is a global food shortage on the way? And if so, what impact will it have on the countries of the Middle East? I think this is something we need to watch more closely in the coming months.
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