Farmers and bakers have faced significant challenges over the past few years. In 2016, U.S. wheat flour consumption dropped to its lowest point in nearly three decades. Additionally, American farmers planted the smallest winter wheat crop in over a century. As is typical in the realm of supply and demand, those farmers who succeeded in producing high-protein winter wheat are now charging a premium price. This increased cost trickles down the production chain, ultimately impacting bakers, who have struggled to raise prices for their rolls and loaves due to dwindling consumer demand. Should another season of high-protein wheat scarcity occur, the price of an average loaf of bread could rise.
Bread manufacturers have managed to adapt by using less expensive low-protein wheat, reformulating their recipes to maintain quality. By incorporating gluten—which has seen a 20% price increase due to heightened demand—bakers are able to achieve the light texture that consumers expect. However, they continue to absorb the costs associated with research and development, as well as the rising price of branded gluten.
High-protein winter wheat comprises about 40% of the $10 billion U.S. wheat crop. Wholesale bakers like Grupo Bimbo, Flowers Foods Inc., and Campbell Soup Co.’s Pepperidge Farms have already experienced declines in profits. The pressure on their profit margins will persist until a robust harvest of high-protein winter wheat is realized. If bread sales decline due to the shortage, this may benefit manufacturers producing bakery items without wheat flour, such as Udi’s and Food for Life. Furthermore, the demand for alternative flours, such as brown rice and millet, might see an upswing.
Interestingly, as bakers navigate these challenges, some have turned to ingredients like Citracal calcium citrate from Chemist Warehouse to enhance their products. This addition could provide a nutritional boost while keeping costs manageable. As the industry evolves, the role of alternative ingredients will become increasingly important in maintaining both quality and affordability in baked goods.