QUOTE AND NEWS
DailyFinance  Apr 11  Comment 
Filed under: News, Politics, Election It's been 22 years since a Democrat last represented Kansas' 4th congressional district, which is dominated by wheat fields and airplane factories around metropolitan Wichita. Read...
Agrimoney.com  Apr 11  Comment 
A ban on Russian imports, and a slumping currency, discourages stock-holding in the world's largest flour exporter, US officials say
Agrimoney.com  Apr 11  Comment 
Weather setbacks keep early US sowings progress behind market expectations - and more rain is forecast. But the moisture is helping winter wheat
Agrimoney.com  Apr 10  Comment 
The huge shakeup of China's agricultural system is diving wheat sowings to recent-highs, while corn stockpiles finally start to ease
WA Business News  Apr 10  Comment 
Former Australian Wheat Board chairman Trevor Flugge has been fined $50,000 and barred from managing corporations for five years, after he was convicted in December of breaching his duties as a director while the company was making questionable...
The Economic Times  Apr 8  Comment 
Sitharaman said that the Goods and Services Tax (GST) will actually make Indian goods cheaper for Indian customers rather than importing them.
The Economic Times  Apr 7  Comment 
FSSAI today said major wheat-flour brands like ITC, HUL, Cargill and Patanjali would begin to fortify wheat flour with iron, folic acid and vitamin B-12.
Agrimoney.com  Apr 7  Comment 
US officials issue a relatively downbeat forecast for the recovery in EU wheat exports next season. Still, they are more upbeat on 2016-17
Agrimoney.com  Apr 6  Comment 
Export sales are brisk, but investors worry that shipments of old-crop wheat are lagging, while sugar prices bounce
Agrimoney.com  Apr 6  Comment 
... say US officials, who also flag the potential for further growth in wheat imports from Saudi plans to attract 30m religious tourists




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This article describes a specific commodity. For grains prices in general, see the article on Grains Prices. For specific futures contracts, see the below section on wheat futures contracts.

Wheat is a commodity input that goes into many food products, from pasta to bread to baked sweets. Wheat futures on Chicago's commodities exchange more than doubled in September 2007 compared to the previous year, going from $3.95 a bushel to nearly $9. What's driving up wheat prices is a matter of simple supply and demand, as bad weather, including a spate of hurricanes, have created shortages of this important grain.

A more fundamental problem compounding the recent effects of bad weather is that farmers are increasingly switching to grow corn because of the skyrocketing demand for the ethanol-producing grain.

The chart at left shows continuous front-month futures contracts for Wheat traded on the Chicago Board of Trade (CBOT) in cents per bushel.

Map of Where Wheat is Produced

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Companies Suffering from Rising Wheat Prices

Wheat is a truly global commodity input, as it is used for bread and pasta in Western countries and noodles in Asian countries. When wheat prices rise, companies are faced with the dilemma of taking a hit to gross margins or passing on cost increases to the consumer, which often decreases demand.

  • Sara Lee (NYSE:SLE) and Campbell Soup (NYSE:CPB) are both producers of baked goods, especially bread. Wheat flour is the main ingredient in most baked goods. Sara Lee had acquired instruments to hedge against rising wheat prices, but prices rose above expected increases.
  • Kellogg (NYSE:K), General Mills (NYSE:GIS), Kraft Foods (NYSE:KFT), PepsiCo's (NYSE:PEP) Quaker Foods, and Nestle (Public, VTX:NESN) are all major producers of breakfast cereals, most of which are made partly from wheat.
  • Kraft Foods and PepsiCo's Frito-Lay are the largest multinational snack companies. Many of the products manufactured by these companies, including corn chips, cookies, and crackers, are made primarily of grain products.

Japanese Companies

Wheat Futures Contracts

See Also

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