Bread price hike expected

Consumers should be prepared for a new “collapse” in the prices of bread, pasta and other staples until at least early 2023.

According to experts, this is the impact of the invasion of Russian troops in Ukraine. At the same time, the two largest exporters account for almost 30% of world wheat exports.

According to a report by Associate Professor of the Data Analysis and Forecasting Laboratory of the Technical University of Crete George Atsalakis and researcher Vassilis Tsoumbris, fertilizer prices doubling compared to 2021 will further increase the cost of grain (harvest in 2022).

At the same time, high prices will remain because of the drought faced by farmers in the US, Argentina and Brazil.

Wheat Price Growth Forecast

Wheat prices jumped 91% in 8 months. The cost is usually stated in metric tons (1000 kg). Previously, the lowest price was $85.3 per metric ton in July 1999 and the highest price was in March 2008 at $419.61. In July 2021, the price was $197, on March 21 – $376, that is, it increased by 91% in 8 months.

The chart shows the price forecast for wheat per metric ton calculated by the forecast model of the Technical University of Crete until the beginning of 2023. The gray dots represent the sharp recent price increase, anticipating the shortages that will come this year due to the invasion of Ukraine. “According to our forecast, by the beginning of 2023, the price of wheat per metric ton will approach $390 (blue line) with a price range of $340 to $480 (orange line),” Atsalakis and Tsumbris said.

Fears that the market is running out of stocks – farmers need subsidies

At the moment, as experts point out, it is obvious that the immediate fears are that the bins may “run out of wheat.”

It is noted that in 2021, the prices of the FAO index for cereals increased by an average of 27.2% compared to 2020, while the cost of wheat rose by 31.3%.

Rising wheat prices may encourage farmers in major exporting countries to start growing more of this particular type of grain than others, such as corn. However, corn, as a staple food for poultry, will affect the price of chicken and eggs.

The wheat market has already been under pressure since mid-2021, due to lower production in Russia, Canada and the United States. This decline kept grain prices at multi-year highs and led to global food inflation.

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