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The closing of the Karni crossing, the main outlet for Palestinian exports and imports to the Gaza Strip, has caused a wheat shortage in the Strip, according to a United Nations report obtained by Haaretz on Tuesday.

On Sunday all the flour mills in the Strip were closed due to the wheat shortage. No flour shortages are expected in the near future due to the large stocks held by Gaza Strip merchants. However, flour prices are expected to rise and flour shortage may be experienced in a matter of weeks.

Israel has stepped up security precautions since the Palestinian elections last month, exacting a humanitarian price in the PA territories, the UN report says.

The UN coordination office for humanitarian issues warned in the report that the PA was in danger of economic collapse due to Israel freezing PA tax money.

According to the report, the PA will find it very hard to supply its citizens with basic needs such as medical services, education, water, electricity, sewage, garbage collection and policing services in the Gaza Strip and West Bank.

The closing off of the Karni crossing is also disrupting Palestinian exports of agricultural produce from the Strip?s hothouses, such as peppers and strawberries, sold to Israel and the European Union. Palestinians estimate that the damage caused to them is $70,000-$100,000 a day.