Retail price of flour fluctuates with farm price of wheat

Retail prices for minimally processed foods tend to fluctuate with farm prices for the agricultural commodities used in their manufacture. Prices for wheat and other grains and oilseeds have risen due to a variety of factors including, most recently, the 2012 drought. Prices for flour in retail stores are up as well. Grinding 1.37 pounds of hard red winter wheat produces 1 pound of all-purpose white flour and wheat middlings that may be used in other food products or animal feed. Over 2011 and 2012, as the farm value—the cost of the wheat in a pound of flour—rose from 10 to 14 cents (a 40-percent increase), the average retail price for all-purpose white flour rose from 48 to 52 cents per pound (an 8.3-percent increase). The farm share of the retail price of flour simultaneously increased from 20 to 26 percent. More information on ERS’s farm share data can be found in the Price Spreads from Farm to Consumer data product, updated March 20, 2013.

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