In the past two weeks, the price of delivered wheat has risen by a further £11 per tonne, breaking the £230 per tonne highs of the 2007/08 season, with millers, including Rank Hovis and ADM Milling, hiking the price of their flour in return.
The price of delivered wheat in the north west for February 2011 stood at £237.50, on 3 February, while contracts for delivered wheat in May were trading at £244.50/tonne, according to the latest HGCA data.
Rank Hovis has announced that, effective from 28 February, it will be increasing the price of all flour grades by £49.38 per tonne (76p per 16kg).
Lawrence Watson head of sales and marketing, Rank Hovis told British Baker that the cost of wheat had continued to rise as the global wheat crop reduced due to harvests around the world being hit by adverse weather patterns.
He added: "Prolonged rain in both Australia and Canada during the harvesting period, coupled with the heatwave in Russia caused a reduction in overall wheat production. As a result, wheat prices have now reached record highs and the wheat market outlook for 2011 remains challenging."
ADM Milling said the price of wheat had been driven to a level it can no longer absorb within its business. It has increased the price of its flours by £46.88 per tonne (75p per 16kg).
Laura Amos of luxury dessert manufacturer The Dessert Deli, which supplies Fortnum & Mason and Harvey Nichols Food Halls, told BB the firm had received a letter on 7 February from its organic flour supplier Shipton Mill, informing her it was putting the price of the flour it supplies to her up by £50 per tonne. Shipton Mill was unavailable for comment as BB went to press.
Alex Waugh, director general of the National Association of British and Irish Millers, said the current price of delivered wheat was the highest he could recall. There have been concerns that the recent cold weather in the mid-west US has killed-off wheat in the ground, which may then be reseeded with soya or maize, but fears about the wheat growing in Russia and the Ukraine have diminished, said Waugh.