QUOTE AND NEWS
Agrimoney.com  1 hr ago  Comment 
Certainly, selling is still evident, but it focuses this time on palm oil, dragging other oilseeds lower. China import data offer support to grains
The Economic Times  3 hrs ago  Comment 
Pramod Tiwari (Cong) said 119 farmers had committed suicide in Maharashtra because of the distress caused by zero import duty and unremunerative prices.
The Times of India  4 hrs ago  Comment 
COMMODITIES-TECHNICALS/WHEAT:TECHNICALS-CBOT wheat to drop to $4.17-3/4
The Times of India  4 hrs ago  Comment 
JAPAN-WHEAT/TENDER:Japan buys 117,689 tonnes food wheat via tender
The Times of India  Mar 22  Comment 
FRANCE-WHEAT/AFRICA:Bad French harvest lets Russian wheat grab west Africa sales
The Times of India  Mar 22  Comment 
EGYPT-WHEAT/MOISTURE:Egypt to keep higher wheat moisture limit till November -French exporters
The Times of India  Mar 22  Comment 
USA-WHEAT/CBOT:Wheat falls 1.2 percent on rain forecast in U.S. Plains
The Times of India  Mar 22  Comment 
EUROPE-GRAINS/:EU wheat hits 7-week low, firm euro weighs on export outlook
The Times of India  Mar 22  Comment 
USA-GRAINS/CBOT:CBOT Trends-Corn, soybeans steady-down 2 cents; wheat down 1-4 cents
Agrimoney.com  Mar 22  Comment 
Traders hope that a new inspection system will make the recent disruptions to Egyptian wheat imports a thing of the past, US officials said




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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

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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