One of the most basic food staples is flour.
It’s used in baking bread which is one of the most important food products in society.
When the price of flour increases, you can expect a few problems.
Unfortunately, you may have noticed that the price of flour has increased.
Considering how important flour is in keeping the world fed, you may wonder why it’s become so expensive.
Why Is Flour So Expensive? (10 Reasons)
The average price of flour is $0.50 a pound.
Certain factors like expensive transport costs, demand, and problems affecting wheat and agriculture all impact the price of flour.
Let’s look at those factors in more detail.
1. High Transport Costs
One of the reasons flour prices have increased steadily is the cost of transporting flour.
Flour sells by the pound and can be quite heavy.
As such, trucks can only carry so much before they reach their weight limit.
Both highways and trucks have weight limits on them.
Highways have weight limits to reduce the damage done to the road.
If a truck exceeds that limit, the operator needs to pay a fee that helps pay for the highway’s maintenance.
Trucks have a weight limit to ensure the engine doesn’t break by hauling too much.
If the truck weighs too much, a lot of stress is put on the engine.
Older engines have a higher chance of breaking.
As such, trucking companies tend to charge per weight.
If a client, like a flour company, has a heavy load, they’re going to need to pay a lot of money to move it.
Fuel costs are another concern.
When fuel costs are high, it becomes more expensive to transport flour.
All these costs essentially make transporting flour quite expensive.
To make up for that cost, flour companies put higher prices on their bags of flour.
Flour is expensive when transportation costs, like fuel, are expensive.
2. Labor Costs
Labor is certainly a part of what makes flour expensive, too.
To make flour, a mill needs to grind certain grains.
In most cases, wheat is one of the more popular grains to grind.
The process of grinding, however, can be quite expensive.
In particular, lots of steps are involved in making flour, which drives up labor costs.
For example, to make flour, you first need grain.
In the case of wheat, you’re going to need to pay a farmer and all their workers.
They plant, maintain, and harvest wheat.
Depending on how large their fields are, it can be a lot of work to harvest it all.
Then the grain needs to pass through a mill.
This is another area where mill workers have to be paid to maintain the mill and check the flour.
Depending on what type of flour it is, there may be a few more steps involved.
Because there are a lot of workers involved in the production of flour, labor costs end up becoming quite expensive.
To make up for those costs, flour companies have to sell their flour at higher prices.
Flour is expensive because of labor costs.
3. Huge Demand
Flour is in high demand.
Flour is the basis of most baked goods.
Whether it’s bread, cake, donuts, or some other baked good, there’s a good chance that flour is somehow used.
Bread is the most popular product made from flour.
Bread is also one of the most important foods in human history.
Because it’s relatively easy and cheap to make, it plays an essential role in keeping people alive.
Its low price has allowed those with little means to buy it and keep themselves fed.
In times of famine, bread has also saved lives.
To this day, it remains an important part of an average diet.
Whether it’s to make a sandwich, toast, or even just to eat on its own, bread is popular.
However, that also means that flour is in high demand.
Because bread is in high demand, companies need a lot of flour to make the bread.
When there’s a flour shortage, there’s a bread shortage.
Since there’s always demand for bread, there’s always a demand for flour.
The problem comes when something affects the supply of flour.
Since flour is in high demand, if the supply of flour is suddenly low, it means the price of flour is going to increase.
Flour is expensive because it’s always in high demand.
4. Drought
Since flour typically comes from wheat, anything that affects wheat is also going to affect the price of flour.
Drought is one of the factors that has been influencing the price of flour.
The states that grow the most wheat in the United States include:
- Kansas
- North Dakota
- Montana
- Texas
- Oklahoma
The problem with some of these states is that they’ve been experiencing severe droughts.
Drought is a problem because it impacts the yield of wheat.
Without enough water, wheat can’t reach its full maturity.
Farmers find themselves with smaller yields.
With a smaller yield, there’s less wheat to use for flour.
As a result, less flour is made than usual.
That impacts the price of flour because it means there’s a smaller supply of it available.
Drought can also make farmers import water to try and keep their wheat fields fed.
That’s a costly venture, too.
Since it costs them more money, they sell their wheat at higher prices.
Flour companies then raise their prices since they have to offset their costs, too.
Flour is expensive because of the drought affecting wheat fields.
5. Fertilizer Costs
It isn’t only a lack of water that’s affecting wheat fields.
Farmers are also finding themselves facing high fertilizer costs.
The price of fertilizer is important because it impacts how expensive growing crops can become.
When farmers have to pay more for fertilizer, they’re going to sell their crops at higher prices to compensate for those costs.
Fertilizer prices have increased for a few reasons.
One is that ammonia-producing plants have had to face various shutdowns over the years.
The primary cause is the resurgence of COVID-19.
Anytime a new case occurs in a factory, the factory shuts down and stops production.
Another reason is that some countries, like China, have closed ammonia plants entirely.
In an effort to fight climate change, they’re trying to find cleaner ways of running factories.
Plants that don’t adhere to their greener standards are no longer able to operate.
As a result, there’s less ammonia that fertilizer companies can use to produce fertilizer.
With less fertilizer in the market, farmers have to outbid one another for access to it.
Since they’re taking on higher costs, they’re selling their crops, like wheat, at higher prices.
Flour companies then have to raise their prices, too.
Flour is expensive because of the high cost of fertilizer.
6. Severe Temperature Changes
Severe temperature changes have also impacted wheat yields.
Texas, for example, has faced some cold winters.
While cold temperatures aren’t necessarily unknown to the state, recently, temperatures have dropped to surprising lows.
This has impacted the ability of farmers to harvest their wheat before the cold kills their crops.
It also impacts their ability to sow for the next harvest.
A sudden shift in temperature can keep a farmer from either being able to fully harvest their fields or prevent them from sowing for next year.
This impacts the supply of wheat available.
That also means that it impacts the flour supply.
When there’s less wheat on the market, there’s also less flour.
Because flour becomes scarcer, its price increases.
The problem with something like sudden temperature changes means that farmers can’t always protect themselves.
It’s difficult to predict when temperatures will suddenly change, especially if you’re accustomed to a certain cycle.
Flour is expensive because severe temperature changes have impacted the supply of wheat.
7. Factors Affecting Seeds
Seeds are a vital part of preparing for next year’s harvest.
If a farmer can’t sow wheat seeds, they’re not going to be growing anything.
The problem with sowing is that climate change has made it difficult for farmers to know when to sow.
Sudden temperature changes, for example, can make a farmer miss their window of opportunity to sow their fields.
Even if they started, they might not be able to finish sowing their fields before the temperature changes and threatens their seeds.
Even the seeds that they do manage to plant may die because of the change in temperature.
Drought can also affect seeds.
Seeds require a certain amount of water.
When a drought occurs, the seeds don’t receive that water.
They die as a result.
Even something like a wildfire can impact the potential for a seed to sprout.
The smoke might damage the seed.
It might block out the sun and keep the seed from receiving the sunlight it needs to produce energy.
Whatever the problem, if something is keeping farmers from sowing or seeds from growing, it’s going to impact the wheat yield for the next harvest.
As a result, there’s less flour on the market.
Flour is expensive when the climate impacts the ability of wheat seeds to grow or become planted.
8. Price Of Corn Impacting Livestock Feed
You may not think that flour and corn are related, but they do.
Corn is often a way that farmers feed their livestock.
It’s a relatively cheap crop that feeds their animals well.
The problem with corn is that its price is increasing.
Whether it’s because of ethanol, fewer farmers growing corn, or other factors, corn has increased in price.
What was once a cheap way to feed livestock is no longer the case.
As a result, some farmers are instead turning to wheat to feed their livestock.
This is where it impacts the price of flour.
With less wheat available on the market, flour companies aren’t able to make as much flour.
They’ll have to outbid the farmers if they want to maintain as much access to wheat as they had before.
Either way, the cost of making flour is increasing.
Since it’s more expensive, flour companies have to sell flour at high prices.
Flour is expensive because of the impact the price of corn is having on farmers.
9. Organic Flour
There are several different types of flour on the market.
One of those types is organic flour.
Organic flour comes from organic wheat.
To be organic, a crop can’t have any synthetic pesticides or fertilizers used in its production.
Instead, the farmer had to have used natural pesticides or fertilizers.
The goal is to make what appears to be a cleaner crop.
It’s more expensive to grow and protect crops in this way.
As such, organic farmers sell their organic products at higher prices.
Since organic wheat is more expensive, organic flour is also more expensive.
Flour is expensive when you use the organic variety.
10. Fewer Wheat Farmers
A final reason flour is expensive is that there are fewer wheat farmers than there used to be.
This is partly because of the rising costs of farming.
Farmers aren’t able to make a good profit from wheat.
As such, they’re turning to other crops that sell at higher prices.
Some are having problems adapting to the climate.
They’ve given up farming because their farms are no longer in ideal locations to grow crops.
Since there are fewer wheat farmers than there used to be, it means the supply of wheat is decreasing.
With less wheat to go around, flour companies have fewer resources to use.
That impacts the supply of flour as well.
With less flour on the market, the price increases.
Flour is expensive because there are fewer wheat farmers.
Conclusion
Flour is a necessary ingredient for making bread and other baked goods.
Unfortunately, due to problems associated with growing wheat and the cost of making flour, it can be quite expensive.
