Ingredient prices not as volatile, but conditions remain treacherous
December 17, 2009
by Josh Sosland
With the extraordinary ingredient price swings of the past three years, it is exceptionally difficult to track a single ingredient’s current price relative to levels of a few years back, much less in relation to other ingredients.
Within grain-based foods alone, ingredient cost changes this year have varied widely. For instance the indexes for bagel and white bread ingredient prices, as tracked by Milling & Baking News, were down year to date 9% and 6%, respectively, while short bread cookies and devil’s food cake were up 14% and 20%.
Cocoa, dairy and sugar prices have stood out in 2009 for their strength, lifting the ingredient costs for desserts, such as vanilla ice cream, up 34%; and a chocolate bar, up 40%. Prices for non-fat dry milk were up 63% as of early December; cocoa prices, up 114%; and beet sugar prices, up 29%.
Divergence between end product ingredient prices changes is even greater over the three-year period ranging from mayonnaise ingredient costs down 11%, to a milk chocolate bar, up 74%. Within grain-based foods, the largest gain was in devil’s food cake, up 54%; while white bread was up 15%; and pasta fell 5%.
Ingredient prices this year have not been as volatile as in early 2008, but market conditions remain treacherous.