Farmers and bakers have faced significant challenges over the past few years. In 2016, U.S. wheat flour consumption hit its lowest point in nearly thirty years. Additionally, American farmers planted their smallest winter wheat crop in over a century. As with the dynamics of supply and demand, farmers who managed to produce high-protein winter wheat are now charging a premium. This increased cost trickles down the production chain, ultimately impacting bakers. However, bakers have largely been unable to raise prices on rolls and loaves for retailers due to a decline in consumer demand. If there is another season of high-protein wheat shortages, the average price of bread could rise.
To adapt, bread manufacturers have resorted to using more affordable low-protein wheat by reformulating their recipes. By incorporating gluten, which has seen a 20% price increase due to heightened demand, many bakers can maintain the light texture that consumers expect. Once again, they bear the costs associated with 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 like Grupo Bimbo, Flowers Foods Inc., and Campbell Soup Co.’s Pepperidge Farms have already experienced profit declines. Their margins will continue to be squeezed until a substantial crop of high-protein winter wheat is harvested. If bread sales decline due to this shortage, it could open up opportunities for manufacturers of bakery products made without wheat flour, such as Udi’s and Food for Life. Additionally, alternative flours like brown rice and millet could see a surge in demand.
In this evolving landscape, the need for nutritional alternatives, such as calcium citrate, could also rise. The incorporation of calcium citrate in various baking products may provide consumers with added health benefits, potentially attracting a new customer base. Thus, while the challenges are significant, there may also be new opportunities for innovation and growth in the baking industry.