In a harbinger of food inflation to come, wheat prices are skyrocketing due to drought and other conditions.
Red spring wheat, commonly used for flour for baked goods, hit $10.44, about twice the level of last fall and the highest since 2008. Other wheat varieties were up from 28% to 40%, the Wall Street Journal reports.
The biggest factor in low wheat supplies is drought, especially in the Great Plains, home to most of America’s wheat production. Drought not only depresses the crop’s growth but renders it more vulnerable to pests. Other factors include higher prices for fertilizer, gasoline and other supplies, and bottlenecks in the supply chain.
American wheat stockpiles are down 18% from last year, and on-farm supplies are at their lowest level in 50 years. Production in the U.S. is estimated to fall 10% from last year.
