A street vendor who set himself on fire after having his fruit cart confiscated, triggered widespread protests in Tunisia and spurred the Arab Spring.
"A surge in the prices of garlic and other staple food commodities in Tunisia was a leading indicator of the approaching revolution now known as the Arab Spring," writes Colin Fenton in a report for JP Morgan.
Now, Fenton points out that garlic prices are surging again.
Garlic prices are 75% higher now than their average price over the past five years, and hit 295 Philippine Peso per kilogram. From JP Morgan:
"Is this humble vegetable already giving us a leading indicator of the return of volatility in global markets? Of the non-US inflationary consequences of zero interest rate policy?" he writes. "Even if its message proves more limited, garlic’s strong price advance is pressuring Philippine food budgets. It is revealing latent food insecurity in Southeast Asia. Seventeen days ago, the Philippine government began daily monitoring of retail garlic transactions in 13 public markets in Metro Manila.
"Data from Google Trends confirms the local population is very focused on this issue. Yet, most of the world is not. Not even China—the largest producer and exporter of garlic," writes Fenton.
Here's a chart from Google Trends showing the rising interest in garlic in Philippines (blue) as compared to China (red) — the world's largest garlic producer and exporter.
And look at the sharp recent uptick in the search for "garlic price":
In emerging markets where food has a significant weightage in the CPI basket, the rise in the price of certain vegetables can destabilize local markets and could even trigger volatility in broader asset classes.
We've seen this with onions in India and food prices in general with the Arab Spring.
For Wall Street which has been bored to death by a lack of volatility, this could be something to keep an eye on.
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