High Plains Journal: Flour on the Brain
amid the coronavirus pandemic
By Lacey Newlin
*This article was taken directly from the High Plains Journal - April 13, 2020 Edition.
With the current health pandemic, one thing is certain, consumers have made a run on grocery stores and cleaned out products they deem essential. For the most part, those chosen commodities have been toilet paper, hand sanitizer, dairy, meat and shelf-stable wheat products like bread and flour.
While this unprecedented chapter in world history is certainly tragic and daunting, Tim O'Connor, president of the Wheat Foods Council, says the wheat industry is stepping up to the challenge consumers have presented and he has hopes the increased demand could benefit the wheat industry.
"Flour has been selling at an unprecedented level of demand," he said. "I've been talking with our members that are flour millers and they have never seen a period of demand like this, including every year during the peak season for flour sales, which is the Thanksgiving to Christmas holiday window when people bake. This is far surpassing that."
In fact, O'Connor says millers are actually changing their production runs to make more consumer-packed flour.
"Big millers generally make most of their products for large-scale customers and it goes out on railroad cars and ton tote packaging not in 5-pound bags," he said. "The small bags we see on the grocery store shelves are a small percentage of the total volume. Grocery stores are finding it to be very similar to other items that are in high demand, like toilet paper. People just want to have flour right now."
O'Connor said he believes people want to have a supply of food and household items in their home because no one knows how long they will be in the current situation plus most states are going to a mandated stay at home policy. Flour is also shelf-stable, making it a desirable pantry staple, but it is also a comfort food, something many people are yearning for during this crisis.
"If you think about the things you make with flour, you think about holiday meals, special occasions, family recipes and food you want to eat in a time of uncertainty," O'Connor said. "The activity of baking together is also a fun way to bring the family together. Another thing we've learned over time is that a large percentage of people bake at home because they can control the ingredients that are going into their food. In a time where people are thinking about their health, baking allows them to control their ingredients a lot better than buying foods and reading labels and not necessarily understanding everything that's on that label. If you're looking to make some lemonade out of some pretty bad lemons, there could have a slight positive impact on wheat and it could even lead to people baking at home more frequently as a byproduct of the quarantine."
Optimism in the face of ambiguity
Although in recent years, many consumers have made conscious efforts to eat less gluten and carbohydrates found in starches like breads, in the wake of a pandemic like coronavirus, they seem to be letting go of those aspirations. Fortunately for wheat growers consumers are going back to the basics of the food pyramid and embracing wheat, which makes O'Connor optimistic that over time this could help wheat prices and lift them out of their current lull.
"The problem with wheat prices right now, is there's too much wheat everywhere," he explained. "That's why fewer acres have been planted, because the wheat market has been dismal. And it's not only because the United States has a lot of wheat, but so do all the other major wheat producing countries in the world. There's no shortfall in supply because somebody's always willing to supply it, and generally at a cheaper price because there's so much around."
However, he has hopes that increased demand could draw the supply down somewhat and lead to some price bolstering. O'Connor says the pandemic will definitely help prices over time, but he hopes the prices could return to more favorable numbers even sooner in the short term.
"The millers have the capacity to make the wheat into flour and there's certainly plenty of wheat in storage waiting for someone to come along and use it," O'Connor said. "All the conditions are right to fill the demand as long as the supply chain keeps working to distribute it all the way into the grocery store."
"In general, growers have produced a lot of good wheat crops in a poor market environment and so there is a surplus and depressed prices and lower planting rates, but there is plenty of wheat in storage and the milling industry has the capacity to make a whole lot more flour."
Lacey Newlin can be reached at 580-748-1892 or lnewlin@hpj.com.
*This article was taken directly from the High Plains Journal - April 13, 2020 Edition.
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