Craig Ponsford, owner of the Californian company Artisan Bakers and chairman of the Bread Bakers Guild of America, has warned that bakers may be forced to increase bread and baked goods prices substantially in response to the sharp rise in the price of flour.
Go deeper with GlobalData
Discover B2B Marketing That Performs
Combine business intelligence and editorial excellence to reach engaged professionals across 36 leading media platforms.
“After years of steady rates, the price of flour has skyrocketed over the past six to nine months,” said Ponsford. “Bakeries already operate on extremely slim margins, and this ongoing increase in the price of flour has put a stranglehold on bakers, leaving them little choice but to raise prices.”
Ponsford said the “dramatic” rise in flour prices was due to increased demand and a poor North American wheat crop. Flour prices reached a ten-year high in July 2006, and were 30% up on the previous year. Moreover, prices have virtually remained at that peak level since then, which he described as virtually unprecedented. Such price spikes are usually short-lived.
The possible price increases will not only affect consumers at the supermarket, but will also have a significant impact on the wholesale market in the US, including an increase in the cost of baked goods supplied to restaurants and other food services entities, Ponsford warned. “If there are continued price increases — and it appears inevitable that there will be — it will be felt across the board,” he said.
US Tariffs are shifting - will you react or anticipate?
Don’t let policy changes catch you off guard. Stay proactive with real-time data and expert analysis.
By GlobalData
