Wheat price increase has far reaching effect

Saturday, March 15, 2008

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The Country Hearth bread factory in Lakeland has eight giant silos that hold 100,000 pounds of flour. In 2007, it costs $30,000 to fill one of the silos. The cost now runs $100,000.

LAKELAND (Bay News 9) -- A trip to the grocery store can quickly confirm that the price of groceries are going up.

And bread prices are among those that have jumped the highest. And that's because wheat prices, along with gasoline, have gone up dramatically.

So much so that bakeries have passed their costs on to customers.

The Country Hearth bread factory in Lakeland has eight giant silos that hold 100,000 pounds of flour.

In 2007, it costs $30,000 to fill one of the silos. The cost now runs $100,000.

That translates into $15 million in extra expenses a year.

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"Well, the consumer is only willing to pay a certain price for the product,' said company comptroller Kenneth Reeves. "So we're having to absorb what we can and pass along what we have to."

Flour prices aren't just affecting corporations.

At the Cookie Jar Bakery in Bartow, Janet Skinner also is dealing with higher prices for flour.

"It's astronomical,' Skinner said of the prices, which have forced her to raise prices. "It's almost like gas prices."

At the Cookie Jar Bakery in Bartow, Janet Skinner also is dealing with higher prices for flour.

The price jumped is blamed on last year's poor wheat crop, increased demand from overseas and the ongoing push for corn-based ethanol fuel.

"They are using land that's normally used to grow wheat to grow corn,' Reeves said. "So that's cut back on the wheat crop which has increased the price of our wheat and increased the price of our product."

That leaves Hearth Bakery officials hoping congress will do something to help deal with the price of wheat - mainly hoping lawmakers earmark more land for wheat farming. Bakery Officials also would like to see limits on wheat exports.