QUOTE AND NEWS
Agrimoney.com  Jun 23  Comment 
... but the prospect of more benign weather ahead prevents much of a rally in Paris wheat futures
Agriculture Online  Jun 23  Comment 
Crops › Wheat News › Crops Byline: Chuck Abbott Spring and early summer are the wet season for the Northern Plains, a...
Agrimoney.com  Jun 23  Comment 
The South American ag powerhouse trims its wheat sowings estimate close to figures from other forecasts. But corn output will hit a record
Agrimoney.com  Jun 22  Comment 
Russian wheat misses out at a tender by Egypt's Gasc for only the second time in a year. Romania, Ukraine win orders. French is cheaper too
Forbes  Jun 21  Comment 
La Brea Bakery wants to be the forerunner of the farm-to-table bread revolution and has launched a series of single-origin bread products using locally grown, heirloom wheat.
Agrimoney.com  Jun 21  Comment 
UK wheat imports this season will exceed exports for only the fourth time in 25 years, officials say, flagging growing biofuels demand
Agrimoney.com  Jun 21  Comment 
Most ags join broader commodities in retreat. Arabica coffee futures hit a contract low. But spread unwinds helps robusta higher, and corn too
Agrimoney.com  Jun 20  Comment 
Ags suffer a tricky session, as commodities drop, weighed by oil, which enters a bear market. Corn, coffee suffer. But wheat futures buck the trend
Agrimoney.com  Jun 19  Comment 
Wheat futures are led higher by Paris contracts, amid worries over EU dryness. But elsewhere, broad commodities weakness tells. Corn, cocoa fare worst
The Economic Times  Jun 15  Comment 
In the present VAT regime, registered packed rice, wheat flour and gram flour are exempt from tax but in the recently declared schedule of GST rates would be under 5% tax.




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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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