Global supply issue forces Rank Hovis to raise prices
Published:  18 April, 2008

Rank Hovis, the miller, has announced a price rise, effective immediately. Flour has risen £34.38p a tonne, equivalent to 55p per 16kg bag.

The last increase took place in early October last year and, prior to that, in August. Jon Tanner, Rank Hovis' sales and marketing director, told British Baker: "The price of domestic and world wheats continues to rise. There are many reasons for the increase, including a poor UK harvest last year, which makes us all the more dependent on a good summer this year.

"The root cause is global supply issues. These are exacerbated by wheat export taxes in several countries. Additionally the flow of money in and out of commodities does not help; it is estimated that speculators have added around 15-20% to the price."

He continued: "2008/9 world total wheat production is forecast at 645m tonnes. We need a record harvest; the world will be in trouble if we encounter weather events similar to last year, because, worldwide, we have the lowest stocks on record."

Tanner is due to leave Rank Hovis and the milling industry for another international job at the end of the month. Until a replacement is found, his role will be overseen by Gary Sharkey, head of wheat procurement.

Sharkey told British Baker: "The wheat market is a continuously evolving picture due to the spread of harvests around the world and their cropping seasons, which take place every month of the year and change the dynamics. Global warming seems to be making a difference, because it appears to be causing extremes. There have been six years of drought in Australia, but also the worst flooding over here in July 2007 that we have seen for years. Using crops for biofuels is also an issue and must be addressed globally."

=== Wheat facts and figures ===

* World wheat prices rose 120% last year

* Excessive rain damaged UK and US crops

* Drought curbed yields in Canada and Australia

* In a good year, the UK can supply 80% of its own breadmaking wheat




My Account

Spotlight

Most read

Social