Wheat Prices Soar To Record High

By Stewart Douglas

The price of wheat on commodity markets worldwide has soared, after a number of announcements indicating a shortage of supply from the world’s major producers.

The news comes off the back of a series of reports from around the world that poor weather in wheat growing nations is leading to a smaller harvest than in previous years.

Wheat, a vital commodity in enabling the manufacture of basic food production, has become a premium commodity around the globe, with manufacturers enjoying all time record prices for their crop as demand continues to rapidly outstrip supply for the grain.

However, the news could lead to prompt food inflation for consumers, as well as hindering international humanitarian aid efforts in countries affected by famine.

Growers in Canada have complained of bad weather weakening their crop by as much as 20% according to some reports, whilst growers in China have forecast a 10% decline in their output this year.

The world’s third largest producer, Australia has suggested that warmer weather over the first half of the year could seriously impact upon volume of output, whilst growers in Europe have experienced heavier rains than in previous years.

As a result, wordlwide stocks have fallen to a 26-year low, sending the price of wheat and wheat produce soaring worldwide to around $7.44 a bushel.

With this fall in supply comes a dramatic increase in demand globally, largely attributed to emerging economies in the East like India and China.  With the growing inequity in supply, prices are likely to continue to rise over the coming weeks and months.

Analysts are predicting the price increase is likely to have a knock-on effect in domestic supermarkets before too long, expecting the price of breads and pasta to increase in line with the supply shortage.