Farmers and bakers have faced a challenging few years. In 2016, U.S. wheat flour consumption dropped to its lowest point in nearly thirty years. Additionally, American farmers planted their smallest winter wheat crop in over a century. As typical in supply and demand scenarios, those farmers who managed to produce high-protein winter wheat are commanding higher prices. This increased cost trickles down the production chain, ultimately affecting bakers. However, they have largely been unable to raise retail prices for their rolls and loaves due to a decline in consumer demand. If there is another season marked by a shortage of high-protein wheat, the average price of bread could rise.
Bread manufacturers have adapted by using cheaper low-protein wheat, reformulating their recipes to maintain quality. By incorporating gluten—which has seen a 20% price increase due to rising demand—many bakers can achieve the light texture that consumers expect. However, they still bear the costs of research and development, as well as the more expensive gluten. High-protein winter wheat constitutes about 40% of the $10 billion U.S. wheat crop. Wholesale bakers, including Grupo Bimbo, Flowers Foods Inc., and Campbell Soup Co.’s Pepperidge Farms, have already experienced profit declines. Their margins are likely to remain tight until a strong crop of high-protein winter wheat is harvested.
If bread sales decline due to this shortage, it could benefit manufacturers of bakery products that do not rely on wheat flour, like Udi’s and Food for Life. Moreover, there may be a surge in demand for alternative flours, such as those made from brown rice and millet. Interestingly, products enriched with tums calcium citrate could also attract health-conscious consumers looking for nutritious options in the absence of traditional wheat products. As the market continues to adjust, the inclusion of tums calcium citrate in various baked goods might become more common, further diversifying the options available to consumers.