QUOTE AND NEWS
Agrimoney.com  Apr 11  Comment 
Grain authority Gasc buys Ukrainian wheat for the first time since January, in what some see as a sign of reduced fears over the country's crisis
The Hindu Business Line  Apr 11  Comment 
After witnessing a continuous fall over the last few days, prices of dara wheat and flour managed to maintain their previous quoted levels on Friday.Radhey Shayam, a trade expert, to...
The Economic Times  Apr 11  Comment 
Global wheat output is expected to drop marginally to 700 million tonnes in the 2014-15 crop year, says the International Grains Council.
Agrimoney.com  Apr 11  Comment 
Argentine wheat exports will rebound, as farmers return to growing the grain rather than barley. But shipments will remain low by historic standards
Agrimoney.com  Apr 10  Comment 
A slew of data proves negative for the likes of cocoa, cotton and wheat, which feels extra pressure from talk of US rains. Coffee futures fare better
Agrimoney.com  Apr 10  Comment 
Brazil's 2014-15 wheat crop will set a record with ease as elevated prices boost the grain's appeal to farmers, Conab says
SeekingAlpha  Apr 10  Comment 
By T. Marc Schober: U.S. wheat sales declined sharply reaching a marketing year low and have declined nine out of the last ten weeks. Wheat exports increased slightly from the past week. Corn sales and export levels declined, but reported levels...
Commodity Online  Apr 9  Comment 
Bill C-30 also includes provisions that would allow the federal Cabinet to set minimum volume requirements for the railways in extraordinary circumstances.




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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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