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US s total wheat production is estimated to drop by 14.6% to 2.134 bullion bushels in 2009 by Analytical company Informa Economics said traders on the Chicago Board of Trade.
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Hard Assets Investor  Jul 1 
The USDA released its Acreage report Tuesday morning and the market got its first gooad look at where final acreage stands for many key crops. Soggy spring no biggie for corn Record soybean plantings Oversupplied in wheat   After...
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Bloomberg  Jun 30 
Corn plunged by the Chicago Board of Trade’s limit after a government report showed U.S. farmers planted more acreage with the grain than estimated in March. Wheat and soybeans also slid on signs of increasing supplies.
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Argentina, the world’s fourth largest wheat exporter last year, may withdraw from world markets for the first time in at least a century as drought reduces plantings.
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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.

See also article on Grains Prices

[edit] Prices

The benchmark for wheat prices are the wheat futures contracts traded on the Chicago Board of Trade under ticker symbol W, which are delivered in March, May, July, September, and December of every year.

Wheat futures prices for a July, 2009 delivery date. Prices are in cents per bushel.

For other futures contracts, see the below section on Wheat Futures Contracts

[edit] 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.

[edit] Japanese Companies

[edit] Wheat Price Trends

Wheat prices reached $8.86 per barrel as of September 2007, more than double that in September 2006.

[edit] Where Wheat is Produced

[edit] Wheat Futures Contracts

[edit] See Also

 
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