Wheat Prices On the Rise
This article addresses the increasing price of wheat and the effect on products in the grocery stores and bakeries. Part of the problem in supply lies in the increased export demand because countries such as Australia failed to produce their normal quantity. Another major problem comes from our federal government giving incentives to the farmers to produce corn for the production of ethanol. This is causing a number of issues. More farmers are replacing their wheat fields with corn fields due to the incentives, causing a reduction in the production of wheat. The supply of corn available to consumers is also lower than usual which is causing the price of items such as feed for animals to increase. The article mentions the desire by some for the government to step in and decrease the amount of wheat available for export, but I believe the government also needs to change their incentives to the farmers to better allow the market to determine production and prices.