The price of wheat has jumped by about 75%, since early July, which is the highest level in two years, according to reports.
What’s behind the price surge?
Severe droughts in Russia have led to a crisis in the production of wheat there, leading to a recent ban on exports of a number of grains from Russia. But with Russia is responsible for about 10% of the global supply of wheat, perhaps the price hike is also highly influenced by speculation. Read about it here if you like econobabble.
Another villain called “wheat rust“, a disease caused by a fungus, is on the rise and is creating some serious concern:
So far rust has not caused a disaster. But that is mostly because of luck, and luck does not last. In the right conditions stem rust destroys everything in its path. After decades in which they have not encountered the disease most of the world’s wheat varieties have fallen behind in the endless battle of thrust and counter-thrust waged by predators and prey. They are defenseless. Wheat is the most widely planted crop in the world, providing a fifth of mankind’s calories. So the return of stem rust could cause vast suffering, threatening mass hunger in some of the world’s most populated areas.
So will price hikes, if they occur, affect you? Well, wheat only accounts for about 25% of the cost of a loaf of bread at the supermarket. We saw prices from our distributor edge up slightly, but we have not raised prices on the variety of flours that we offer to you. Hopefully we won’t have to worry about that and we’ll see the markets settle down. But watch this space for more news.
