You may know this already. There's no use beating around the bushel of wheat: we have a price increase underway. We're sure that like us, you've seen the headlines: inflation rising, prices going up, and the cost of food in Canada getting more expensive. Listening to a radio broadcaster yesterday, they described people experiencing "sticker shock" in the grocery store. Look, we get it - we're seeing the same things when we go grocery shopping.
Some of the news headlines have been tied to COVID-19 disrupting global transportation networks. In other cases, it's impacts due to drought and flood and other weather phenomena. Those last two in the list are most important for us. We've been watching what's been happening with the cost and production of wheat in Canada (and Globally), and the numbers don't look great. Production has been falling, and the cost of wheat has been rising.
This month we're experiencing delays with our orders of durum wheat semolina flour (the main ingredients for our sourdough pastas), as well as a significant price increase. We've also seen our shipping, transportation and utility costs go up as well. We try to avoid price increases, but we can't avoid a response of our own with what's happening right now.
Wheat Production Falling, Costs Rising
We take great pride in sourcing our ingredients local to Canada. It's part of our philosophy of supporting our local Canadian farmers and the high quality wheat grown on the Prairies. Canada is a global wheat exporter: we ship a lot of our durum wheat to countries like Italy, who produce pasta and other products, that then get shipped and sold here and elsewhere. For us, it makes sense to buy ingredients local, to produce within the country, and to sell our pastas mostly here.
However, we rely on the stability of wheat production, and constancy in the price of wheat. When the cost of wheat goes up, our pasta prices need to go up. For this year, a few things have been impacting the price of wheat, causing it to rise. We don't need to look far to find the CBC reporting on the impact of drought affecting wheat production in Alberta this year, where the price of durum wheat has risen whopping 70% compared to last year.
S&P Futures also produced a September feature about how rising wheat costs are making bread and pasta cost more. Their article shows a bit of a global comparison of wheat production. Canada is one of the major three wheat production companies, along with Russia and the United States. The figure in the graph below shows that wheat production is lower across those three countries.
More directly, they also produced another graphic showing the direct rise in costs in several major wheat growing countries, including Canada:
This image shows that the cost of wheat has gone up since August last year. That is certainly what we've noticed when we place orders for our ingredients.
Even as a domestic buyer of Canada's wheat, we pay the same market price that's reflected in the global wheat market.
Other Rising Cost Impacts
Other impacts to the pricing are shipping, fuel, and utility, which have all had increased rates in the last few months. You've probably felt it at the fuel pumps, too.
You may also be aware that while durum semolina wheat is the main ingredient in our pastas, it's not the only one. While some of the other grains and seeds we use haven't seen as steep an increase as the wheat, there are increases almost across the board.
With the cost of living increasing too, we made a decision to give raises to our employees wages to reflect inflation and other rising costs. As an employer, we do our best to support our employees and pay a living wage for the Kaslo area. We know it's important to support good people and their families.
Bulk Pasta Options
One option is available if you are worried about the price increase. We offer combos of our bulk 2 kilogram bags of our three most popular kinds: the classic radiatori, classic rotini and classic spaghetti. Those are available in our online shop. The price per gram of pasta is more advantageous compared to the smaller bags.
Thank you for sticking with us!
We thank you for understanding about this price increase and for your continued support! We did not make this choice lightly. But the trends of the costs of wheat are hard to ignore. We appreciate you sticking with us through this and hope 2022 brings us a better growing season for wheat!
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