Flour will rise 8% on “average” from Mondayinformed a source from the Center of Industrial Bakers of Uruguay (CIPU) to The Observer. What’s more, “There would soon be another similar increase” if the wheat – in soaring international values as a result of the war – does not go down soon.
The mills had already anticipated that it was “imminent” to raise the price of flour this month and that the increase would be divided into two parts to cushion the impact on demand.
The CIPU source explained that the increase It will not be the same for all flours. “There is not a single increase, it depends on the type of flour and the mill. We think 8% is a reasonable average,” she maintained.
Due to Russia’s invasion of Ukraine, both countries have had problems exporting the cereal, putting pressure on the price due to the lower supply. Ukraine is responsible for about 12% of world wheat exports and Russia for another 16%. Russia is the world’s largest exporter and Ukraine the third. behind the US.
After a year of moderate growth—generally not exceeding US$300 per ton—lInternational wheat values soared in the second half of February. The Rosario Stock Exchange, which specializes in monitoring commodities linked to agriculture, indicated on Monday that the “Russian-Ukrainian crisis and its warlike outcome continue, which results in the extension of the closure of exports from ports ” from Ukraine.
Wheat, which reached an all-time high of US$491 per ton on the Chicago benchmark market for the May contract on Monday, moderated its rise and is currently trading on an axis of US$ 399 per ton. It had been 9 days since the price of cereal fell below the $400 mark.
Livestock Minister Fernando Mattos commented on Monday that the strong increases in future contracts for some grains, such as wheat, “unfortunately” will be transferred to baked goods in Uruguay as well as vegetable oils. In addition, he added that it also generates an “indirect consequence” in the production costs of meats that are more intensive in the use of grains, such as poultry and pork.
On the other hand, President Luis Lacalle Pou said yesterday that the government is “studying mechanisms to regulate possible price increases that are produced by war”.
