Food Shortages and Food Riots Go Hand In Hand

Food Riots are an unpleasant thing, happening many times throughout history, most notable just a few years back in 2008 and more recently in Tunisia and Algeria. Rising prices along with food shortages create sometimes violent civil unrest, resulting in food riots.

Many factors contribute to food shortages or perceived food shortages resulting in civil unrest:

Weather, such as most notable in 2010 in Russia where drought and high summer heat records severely damaged this major world wheat supplier, and incidentally, had to cancel exports to Egypt, we saw what happened there.

While Russia’s production rebounded in 2011, the central plains in the U.S. has endured a drought and high temperatures which may affect the 2011 winter wheat crop.

Commodities Exchange, it’s all about supply and demand, resulting in the determination of prices on the world market with speculators buying and selling grain contracts with various regulations or lack thereof on specific individual contracts. Buyers such as General Mills use the market to lock in their prices and actually take delivery of the commodity purchased. News of weather or crisis events or even the rumor of an event anywhere in the world will have an effect on prices.

Political Forces & Policies, so many items involved here so I’ll just name a few. Anything from paying farmers not to plant, making ethanol from corn/grain, price controls, fuel prices, to uncaring government regimes controlling import and supplies in their own countries.

This last mentioned type of government control unfortunately affects the poorest and most needy.

Distribution, not so much a shortage contributing issue, unless it is in an undeveloped rural country where supply systems are unreliable, but the cost of distribution greatly affects food pricing, namely high fuel costs for transport and harvesting.

Buying Power, the one less visible thing that creeps up slowly, yet has a profound impact on food prices in general is the strength of currency.

The Euro is near collapse, the U.S. dollar has been in steady decline for quite some time, which contributes to inflation and affects the final price of a food product, making it harder on the consumer. Smaller food containers for the same price is one sure indicator of inflation.

Monetary Value, If the U.S. dollar ceases to be the world monetary standard, or collapses, we will most likely see prices jump 10-20 fold, the printing of money to cover debt has always led to hyperinflation and financial collapse, it is an unsustainable path from which few recover.

The jobless, We are in a slow economy, housing market stinks, hundreds line up for a job opening, some have given up looking for a job, unemployment benefits have run out for many.

Couple this with high fuel and food prices, it won’t take much for the frustration to boil over. We already have instances of “flash mobs” descending upon stores and taking what they want and walking out. Throw in hyperinflation and we may have hit the tipping point.

Preparation, Much of this is out of our control as all of this together creates some very complicated situations, but the one thing you do have control over is yourself and what you do, we may not like it, but food riots or civil unrest for any reason may be coming to the U.S., a lot of signs already point to it.

Stock Up, Be sure you have enough emergency supplies on hand as well as the 37 critical food items needed to survive a crisis, no telling how long an event could last leaving the store shelve empty.

Read more on my home page here.

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