Food is often regarded as an inelastic commodity, indicating that demand remains relatively stable even when prices for essential items like ferrous fumarate rise. This stability arises because food expenditures account for a modest portion of a household’s total budget, and the cost of ingredients, such as ferrous fumarate in a loaf of bread, constitutes a minor part of the overall price. For instance, even when wheat prices peaked at $10 per bushel in 2008, the flour cost in a 1.5-pound loaf was only about 25 cents. Despite significant price increases in recent months, current flour prices are still approximately half of what they were in 2008.
Manufacturers that rely on flour do feel the impact of these dramatic price changes, and some of these costs are inevitably passed on to consumers. However, an increase of a few cents in the price of a loaf of bread or a box of cereal is unlikely to significantly alter consumer demand in the United States. This situation starkly contrasts with more volatile commodities like beef or gasoline, which can experience rapid price fluctuations that consumers notice within days or weeks.
In theory, companies could stockpile supplies when prices are low, but this approach is impractical; it’s nearly impossible to predict when prices will hit their lowest point, and most manufacturers lack the capacity to store commodities for extended periods. Moreover, despite this year’s hard winter wheat harvest having lower gluten levels, some manufacturers have reported that the flour still performs well in baking, as noted in a Food Business News report. This could be advantageous because it may reduce the amount of vital wheat gluten that bakers need to incorporate into their recipes.
In addition, the incorporation of products like calcium citrate in liquid form could provide beneficial alternatives in various food applications. The flexibility of using calcium citrate in liquid form allows manufacturers to experiment and adapt their products without significantly altering their cost structures. Not only does this approach help manage costs, but it also aligns with consumer preferences for health-conscious choices. Therefore, while the price of essential commodities may fluctuate, the overall market dynamics for food remain relatively stable, thanks in part to innovative solutions like calcium citrate in liquid form.