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The war in Ukraine is driving up wheat prices worldwide. Here's why

The increase in wheat prices are already being felt by small business owners. Bakeries in Dallas-Fort Worth are seeing increases in the price of wheat flour.

FORT WORTH, Texas — Every day, rows of freshly-baked pan dulce delight customers, and the aroma of the Mexican sweet bread fills the air at Esperanza’s restaurant and bakery in Fort Worth. 

Baking the sweet bread is a nearly 40-year-long family tradition at the restaurant.  

But as the price of wheat soars, Esperanza’s is just one of many bakeries that told WFAA that wheat flour price increases are hurting profits.  

Joe Lancarte, one of Esperanza’s owners, said it’s a challenge.  

“I see it going up,” Lancarte said. “It has gone up somewhat really in the last month or so.”    

Russia’s war in Ukraine is driving an increase in wheat prices. Together, Russia and Ukraine export more than a quarter of the world's wheat, according to USDA data.  

“During the pandemic, that made it hard enough with pricing going up and the shortage of everything with everything going on,” Lancarte said. “Now with what’s happening with Ukraine, that has not made it better.” 

Dr. Mark Welch, a professor at Texas A&M University’s School of Agricultural Economics, researches the economics behind wheat and other grain products. 

Ever since the war in Ukraine began, he’s been tracking the conflict’s impact on wheat prices globally.  

“The global economic impact is very far-reaching,” Welch said. “[The U.S.] we’re completely self-sufficient in our grain use, however, the conflict and disruption of global supplies is driving prices higher.” 

Welch pointed to data from the USDA, which showed that when the invasion in Ukraine began in mid-February, wheat prices in Texas were $8 per bushel (60 lbs. of wheat). Now, wheat in Texas costs $12 per bushel. 

“That’s a 50% increase,” Welch said.  

Welch said the increase in wheat prices gets passed down from wholesale wheat suppliers, to bakeries, to grocery stores, until it eventually hits consumers. 

Lancarte is already feeling the impact.  

“We’re trying to do our best to try to keep the price down as long as we possibly can,” Lancarte said.  

Lancarte fears that increasing his pan dulce prices would lead to losing customers.  

“Our quality is number one, so if the price goes up, the price goes up. We’re not gonna skimp and go with a cheaper flour where the quality is not as good,” Lancarte said. 

He hopes his customers will keep walking through the door to enjoy the family’s pan dulce recipes that have been passed down for generations.  

 

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