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Rising wheat prices won't necessarily push bread prices up

With warnings of increased bread prices in the news, AHDB take a look at the relationship between wheat prices and bread

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Rising wheat prices won't necessarily push bread prices up

A small harvest this season was helping support UK milling wheat prices with a huge range in quality and yield reported across the country.

 

National news outlets have run stories anticipating wheat prices driving up the cost of a loaf of bread. With the economic fallout to come from the Covid-19 crisis, consumers were likely to be even more careful with their money.

 

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But according to AHDB head of market specialists for arable David Eudall the price of wheat does not translate directly and proportionately to the price of bread.


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“Wheat prices have a much more direct and pronounced impact on flour, but the subsequent bakery production processes, ingredients, packaging, marketing and transportation mean that wheat isn’t directly related to the price of bread.


“We estimate that the value of wheat in an 800 gram loaf of bread stands at only 11 per cent,” he said.

 

Retail

 

Bread prices have actually reduced in 2020 and while there has been volatility in the wheat markets, the price of a loaf has not followed suit.

 

“With a small harvest and increased imports, our domestic milling wheat prices have been moved higher.

 

“However, the price of a loaf on the shelf will be far more influenced by the need for supermarkets to keep consistent prices for consumers amid the record-breaking recession we face and possible deflation.”

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