Daily Bread Prices to Skyrocket
Global demand for flour, a staple ingredient for nearly every culture,
has grown to such a pitch that Pittsburgh-based Bread Bakers
Guild of America warned of major price increases. Flour is now at
a 10-year high, said Craig Ponsford, chairman of Bread Bakers Guild,
and prices will only increase further.
Ponsford, owner of Artisan Bakers in Sonoma, CA, warns that bakers may
be forced to substantially raise their prices on bread and other baked
goods due to the soaring price of flour.
“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, a 15-year veteran of the baking industry, blamed the rising
flour costs on increased global demand, which he describes as
“dramatic.” That increased demand, coupled with a poor wheat crop in
North America, pushed the price of flour to a 10-year high in July of
2006 -- up 30 percent from 2005 -- and it has remained at that peak, a
virtually unprecedented situation for a market in which price spikes
are traditionally short-lived.
The average price of a standard loaf of bread in New York City has
risen from $2.99 in July 2006 to $3.99 (and higher) in February 2007.
Ponsford warns that the coming price increases will not only affect
consumer at the retail level, but too will impact the wholesale market
already with tight margins in the United States.
“If there are continued price increases -- and it appears inevitable
that there will be -- it will be felt across the board,” said Ponsford.
Ponsford attributes the current situation to a confluence of events,
including poor harvests in the United States and Canada, a severe
drought in Australia that cut that country’s production by 50 percent,
and the resultant increased demand from China, for whom Australia is
the major supplier.
“As the ‘breadbasket of the world,’ [the United States] has enjoyed
relatively stable wheat and flour prices since the end of World War
II,” said Ponsford. “But as we are increasingly affected by the forces
of globalization, and in ways we don’t yet entirely understand, we may
be facing a whole new ballgame.”
Ponsford is a true bakery artisan in which his Sonoma store creates
bread, Danishes, and desserts daily from scratch. Ponsford is a
recipient of the gold-medal from Coupe du Monde de la Boulangerie, an
international baking competition held annually in France.
The Bread Bakers Guild of America is a non-profit education alliance of
professional bakers, baking educators, home bakers and ingredient and
equipment suppliers. The organization presents seminars for continuing
education and professional development for artisan bakers and trains
young people interested in careers as bread baking professionals.
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