Rain in Saskatchewan, revolution in Egypt: How soaring food prices helped topped dictator
By Randy Boswell, Postmedia News
Did wet weather last summer in Saskatchewan help bring down Hosni Mubarak?
The surprising answer is yes, and the chain of events that links a poor 2010 wheat harvest in Western Canada to recent political turmoil in North Africa and the Middle East - which culminated Friday in the forced resignation of Mubarak, the much-loathed Egyptian president - is raising difficult questions about world food production amid the cries of joy emanating from Tahrir Square in Cairo.
When a well-educated but impoverished vegetable seller in Tunisia set himself on fire in December, an act of protest widely viewed as the spark that unleashed this young year's unrest across the Arab world, soaring food prices were identified as a major source of grievances in each country swept up in the furor, including Egypt, Jordan, Yemen and Algeria.
And while demonstrators have targeted those nations' ruling regimes for a wide range of reasons - from unemployment to conspicuous corruption to severe restrictions on personal freedom - skyrocketing prices for food and other basic needs was a key, underlying rationale for the revolutionary fervour.
``The big question about uprisings against corrupt and oppressive regimes in the Middle East isn't so much why they're happening as why they're happening now,'' Krugman, the Nobel Prize-winning economist and New York Times columnist, wrote this week. ``And there's little question that sky-high food prices have been an important trigger for popular rage.''
Last week, the UN Food and Agriculture Organization reported that its world food price index had reached a historic peak in January, up 3.4 per cent from December and showing no signs of easing.
``The new figures clearly show that the upward pressure on world food prices is not abating,'' said FAO economist Abdolreza Abbassian. ``These high prices are likely to persist in the months to come. High food prices are of major concern especially for low-income food deficit countries that may face problems in financing food imports and for poor households which spend a large share of their income on food.''
Experts, including Abbassian, have said the initial cause of the ``price shock'' was a drought that devastated Russian crop yields early last year and subsequently led Moscow to impose a ban on grain exports, squeezing global wheat supplies.
But then came Saskatchewan's record-setting rains, preventing farmers from even planting wheat on millions of acres of drenched agricultural land.
``What is typically the driest province was never wetter,'' Environment Canada noted in its year-end review of the country's Top 10 weather stories of 2010, which placed Saskatchewan's ``Summer of Storms'' at No. 6.
By the end of July, as noted by the Canadian Wheat Board in a midsummer update, ``unseeded acres and low production'' had created a ``dire situation for many Prairie farmers.''
Farmers ``are resilient,'' CWB chair Allen Oberg said in the board's July 30 statement, ``but when you cannot even get seed into the ground, it's devastating."
Despite some late-summer relief that allowed many western farmers to salvage their crops, the final Canadian wheat harvest was well below expectations in volume and quality.
In a recent interview with Postmedia News, with the Egyptian crisis coming to a head and FAO officials raising red flags about persistent food inflation, Canadian Wheat Board market analyst Neil Townsend said that Canada's sub-par wheat harvest exacerbated global supply problems in 2010 that were further worsened by Australia's recent weather woes.
``In Canada, the production disappointment was profound and really pronounced,'' said Townsend, noting how low yields and poor crop quality in this country added to the upward pressure on world wheat prices.
Still, he said, ``nobody thought prices would go this high.''
Various factors apart from last year's extreme weather events in Russia, Canada and Australia are now being cited for the price spike in wheat and other agricultural commodities.
Some critics are pointing to increased market speculation that has farmers and agri-business investors gambling on what crops should be planted each year, skewing production patterns.
Townsend said U.S. incentives first offered almost a decade ago to encourage producers to grow corn for ethanol have led to stiffer competition between corn and other crops for limited farmland.
With bad weather, rising demand and production problems all conspiring to create pressure on food prices, ``there's no wiggle room in the system'' at the moment, he said.
``I wouldn't say its directly because of Canada,'' said Townsend. ``And what's happening northeast of Saskatoon might seem irrelevant to Canadians in general, but if those 10 million acres that didn't get planted did get planted - and there was that much more of that (wheat) around - it would dampen a lot of things.''
Meanwhile, the weird weather of 2010 has observers wondering if the food- price crisis it precipitated - and the political unrest it has helped spawn, however beneficial that may prove to be for destabilized Arab nations - is a sign of things to come.
``While several factors have contributed to soaring food prices, what really stands out is the extent to which severe weather events have disrupted agricultural production,'' Krugman writes. ``And these severe weather events are exactly the kind of thing we'd expect to see as rising concentrations of greenhouse gases change our climate - which means that the current food price surge may be just the beginning.''
rboswell@postmedia.com
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