Wheat Price Rises Relentless
by Stewart Douglas
Wheat prices have again closed at a record high over $9 a bushel, prompting global fears that the price of bread and other wheat based products could rise.
The price of wheat touched the heights of $9.113 in the US on open commodity markets, as a result of supply shortages caused by bad weather across the world. As a result, many analysts fear that the price of bread and pasta could soon rise in line with rising costs of manufacture.
Supply shortages across the world have led to much of the price inflation, with some of the world’s main growers reporting significantly weaker harvests this year, as compared to previous years.
In fact, some growing nations like Canada were approaching harvests almost a fifth down on last year as a result of unfavourable growing weather and more severe weather patterns – a possible result of global warming. The result of weaker supply is that reserve stockpiles across the world are dwindling, which has sent the price per bushel beyond all previous record levels.
Complimentarily, demand for wheat and wheat based products has skyrocketed from India and China, where these exploding economies are now growing at such a rate as to demand more from the marketplace, resulting in a further upwards price pressure.
With wheat prices continuing to grow on the open markets, analysts are fearing that this could lead to a more widespread inflationary pressure of a global scale, given that wheat is also a substantial raw material in meat, as a component of most animal feeds.
Analysts are predicting that if wheat were to continue to rise in price, food overall would inflate to increase the standard of living, which would then see less disposable income in households to fuel economic growth, which could ultimately lead to a worldwide recession.
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