2:40pm

Tue February 1, 2011
Planet Money

Protests And The Price Of Bread

Egypt is the world's biggest importer of wheat. And the global price of wheat has gone through the roof in recent months.

So are rising wheat prices part of what's driving the protests in Egypt?

To find out, I called Abdolreza Abbassian, an economist and grain expert at the UN's Food and Agriculture Organization. Here's what he told me.

Egypt is a poor country. But many of its poorest citizens haven't felt the brunt of higher wheat prices, because a massive government subsidy program provides bread for the poor, Abbassian said.

That program broke down in 2007 and 2008, the last time wheat prices spiked. "Bakers receiving subsidized wheat were selling it onto the open market," Abbassian said. "The result of this imbalance was a lot of tension and violence."

Something apparently changed after that, Abbassian said, because there was little sign of those tensions in recent months, as wheat prices rose again. That suggests the subsidy program continued to function.

Bottom line, according to Abbassian: These protests aren't about the price of wheat.

"Right now, at this moment, people just have such hope and imagination about how things are going to be," he said. "As important as bread is, people are seeing something historic happening."

He didn't want to speculate about what the country's short-term food situation would be like as a result of the protests. But he did say that the popularity of the government's wheat subsidies means they're likely to continue in the longer term, no matter who is running Egypt. Copyright 2011 National Public Radio. To see more, visit http://www.npr.org/.

Related program: