Wheat prices reach record level

Wheat prices have hit record highs on global commodity markets, bringing the threat of rising bread prices.

Bad weather in key grain growing areas such as Canada and parts of Europe has limited supplies as demand has risen, sparking fears of a supply shortfall.

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The dire forecast came as Canadian officials said the country expected its harvest to be slashed by a fifth as a result of drought.

Meanwhile, its rival Australia – the world’s third-largest wheat exporter and a key supplier to Asian regions and South America – has also warned harvests may be reduced by warmer-than-expected temperatures experienced in the spring.

Crops in the Black Sea area of Europe, however, have been ruined by bad weather, while Chinese production is expected to fall by 10% as a result of both flooding and droughts.

And as supplies fall, demand from emerging economies such as India is increasing – factors which helped push prices to record highs of $7.44 a bushel on the benchmark Chicago Board of Trade market in the US on Thursday.

BBC