QUOTE AND NEWS
Agriculture Online  Feb 24  Comment 
News › Crops Byline: Chuck Abbott U.S. wheat growers will reap their smallest crop in 11 years, down 20% from 2016, while the farm-gate...
Agrimoney.com  Feb 24  Comment 
Argentina lifts its estimates for its wheat harvest - and exports. Rains have curbed corn, soybean sowings. But will they boost yields?
Agrimoney.com  Feb 24  Comment 
US officials see the domestic wheat crop tumbling in 2017-18 at a rate exceeded only once in 50 years, contributing to a drop in world output
Agrimoney.com  Feb 24  Comment 
Black Earth Farming flags ideas that farmers will not be able to hold out for ever for higher values, as it unveils a return to the red
Benzinga  Feb 24  Comment 
March Chicago Wheat is trading at 436 1/4, down 1 3/4 cents/bushel. May Chicago Wheat is trading at 451 3/4, down 1 3/4 cents/bushel. March Kansas City Wheat is trading at 455 1/2, down 2 1/4 of cent/bushel. Wheat futures are trading a little...
Agrimoney.com  Feb 23  Comment 
A "poor profits outlook" may see some farms cut wheat in spring sowings, the IGC says, as debate grows on Russian prospects
Agrimoney.com  Feb 23  Comment 
Rabobank flags a "supportive outlook" for wheat futures, and scope for cocoa, soy price gains. There are bullish factors in cotton too, but...
Agrimoney.com  Feb 22  Comment 
The biggest wheat buyer accelerates purchases, even as supplies from top origin Russia get more expensive - in some cases topping French offers
Agrimoney.com  Feb 22  Comment 
Wheat futures, for now, steer clear of confrontations with key chart points, as importers enter the market. Cotton gets help from Australia dryness
Agrimoney.com  Feb 21  Comment 
The bank sees little scope a wheat price rise over 2017, even while flagging the potential for El Nino to reverse Australia's crop fortunes




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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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