Category: food prices
As if the Middle East didn’t have enough to deal with already – rising food prices are now threatening to cripple many already strapped people. QNB Capital reported that the rising food prices in the area are a result of many factors including rising income levels in countries like China, unseasonal weather and fule price spikes.
Food prices rose a record amount in 2010, with a 25% increase. As reported by QNB Capital, the index of global food prices maintained by the UN Food and Agricultural Organization rose by 25% in 2010, surpassing previous records set in June of 2008. This number has increased even further in 2011, increasing by another 9.9% so far this year.
Hitting the Poor
The World Bank reports that these figures are hitting the poorest in society the hardest and bringing the world, as they report, near a “breaking point.” The World Bank’s food price index is at record levels as well, having increased 15% between October 2010 and January 2011. The Economist Intelligence Unit (EIU) has also projected a 19% rise in food prices for this year.
Food Price Impact
The impact that these food price increases have on the area depends on the share of household food expenditures in each location. For instance, in Egypt, food represents 39,9% of the Consumer Price Index compared to Qatar where it’s only 13.2%. In addition, the current food price increases are mostly for basic foods, rather than for more expensive or processed food items. This impacts poor populations more than it does the wealthy, since poorer people tend to buy more basic foods such as rice.
As QNB Capital reported, “As the Middle East relies mainly on food imports, the region is particularly vulnerable to food security concerns. If this trend of rising food prices continues, Arab countries will likely be forced to increase their strategic food reserves and develop technologies to boost domestic production to meet growing food demand.”