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Low global wheat supply leads to higher food prices

by Nishi Gupta

KTVB.COM

Posted on June 7, 2011 at 10:37 PM

Updated Wednesday, Jun 8 at 10:42 PM

BOISE-- A decrease in global wheat production is already affecting the price of not only the bread you buy but cereal, pasta and just about anything from waffles to whiskey.

Wheat is Idaho's second largest crop, second to the potato.

The high demand for a low supply is in theory good for our farmers.

But the cooler weather and price of fuel may cause them to lose more money.

"42 of the 44 counties in Idaho grow wheat," said Blaine Jacobson of the Idaho Wheat Commission.

So one might think a dwindling wheat supply around the world would be a boon for Idaho's wheat farmers.

Price of wheat has gone up a dollar or two per bushel, but farmers aren't cashing in.

"I've been farming 33 years, and I've never experienced this," said Meridian wheat farmer Drew Eggers.

The cooler weather has made Eggers wheat crop vulnerable to a disease called striped rust.

It turns leaves from green to yellow and red, preventing sunlight from getting to the plant and eventually stopping its growth.

Eggers planted 150 acres of wheat last fall.One percent of it is damaged from striped rust.

He'll spend several thousand dollars spraying it to protect the rest from disease.

"When the temperature is above 75 degrees you don't usually have striped rust problems, but with this cool wet weather that we've had this spring," said Eggers. "It's become quite a problem in quite a few fields in southwestern Idaho."

Plus rising cost of fuel makes harvesting wheat and getting it to the west coast to be exported much more expensive.

While we've had wet weather, large wheat growing states like Kansas, Texas, Oklahoma and Nebraska are experiencing a drought.

Russia, the world's largest wheat exporter, has put a ban on wheat exports due to its own lack of wheat supply.

China and Canada are also struggling to grow the crop.

All of those situations are leading to an increase in what we pay at the store.

The Idaho Wheat Commission says the price of food with wheat is about 5 to 10 percent higher than usual. And it may not stop there.

"Still around the world there is so much demand and such little production that wheat prices will continue to be higher than what they were a year ago," said Jacobson. 

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