Italian millers see their margins hit as they fail to pass on surging wheat costs to final consumers, the deputy director of the Italian millers' association Italmopa said on Tuesday. Millers, bread and pasta makers have come under fire in pasta-loving Italy over last few months for price hikes seen by consumer groups as unjustified.
"There has been an increase in flour and semolina prices, but it was inferior to that of grain prices," Italmopa's Piero Luigi Pianu told Reuters in a telephone interview. He declined to say how much flour and semolina prices have increased. Italy is hostage to international wheat prices as it imports about 60 percent of its soft wheat needs and about 40 percent of its durum wheat, which is used for making pasta.
Soft wheat prices have risen in Italy by some 70 percent since the start of the 2007/2008 marketing year, while durum wheat prices jumped 150-170 percent, triggering a rise in flour and semolina prices, Pianu said. Italy's Agriculture Minister Paolo De Castro said on Monday he was concerned about grain price rises and their impact on food products and called for maximum price transparency.
Italmopa's Pianu defended Italy's grain processing industry saying it was "very responsible" in absorbing part of the wheat price hikes, saying that otherwise bread and pasta prices would have risen even more.
"Of course, we have seen a significant reduction of margins," Pianu said without giving details. Wheat accounts for 70-80 percent of flour and semolina production costs, he said.
Pianu said wheat prices were likely to remain high this year, despite expectations of bigger crops in many countries, and would support flour and semolina prices. Prices of soft wheat of bread quality were unchanged at 285-288 euros a tonne on Milan's cereals bourse on Thursday, while durum wheat prices were also firm at 530-535 euros a tonne. Flour and semolina prices were also flat.
JORDAN BUYS 100,000 T HARD WHEAT IN TENDER:
HAMBURG: Jordan's state grains buyer has purchased 100,000 tonnes of hard wheat in a tender for the same volume which closed on Tuesday, European traders said. The price was said to be $574.50 a tonne c&f and the origin was at the seller's option but thought likely to be from the Black Sea region or Kazakhstan.
The tender sought 50,000 tonnes for shipment between April 10 and April 25 and 50,000 tonnes between April 25 and May 10. In its previous wheat tender on February 5, Jordan purchased 115,000 tonnes of mostly Kazakh, Russian or other Black Sea region hard wheat at a lower price of $464-$477 a tonne c&f for shipment from March 5-20.
Since then, global wheat prices have surged, particularly for high quality wheat in the United States. "The price rises in US futures are starting to cause a serious increase in the cost of wheat importing by consuming countries," one trader said.
"Cheaper east European wheat is also in short supply and its prices are rising. Importing countries are facing a large rise in wheat bills." Jordan has increased purchases in recent months following a decision in January to double its wheat stocks to provide a buffer against the dramatic rise in global wheat prices.
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