“Liberty and baked bread” are all people really need, an old French proverb says. One of those is about to get more expensive as bakeries raise baguette prices, citing surging grain costs.
“We have no choice,” said Michel Galloyer, whose baguette was voted the best in Paris in 2010. “Wheat prices have exploded. We’ll have to pass on 4 to 5 cents when flour prices start to rise, probably in February.”
The French consume about 23 million baguettes a day — more than 8 billion every year — supplied by 33,000 bakeries and retailers such as Carrefour SA, the National Association of French Millers estimates.
Wheat prices almost doubled in the past 12 months on NYSE Liffe in Paris, with March-delivery wheat closing Friday at $336 a metric ton, after a drought in Russia and floods in Canada and Australia wiped out crops. The dozen Le Grenier u Pain stores that Galloyer runs plan to increase the price of a baguette by 5 cents next month, to $1.54.
“We didn’t see anything coming in June or July,” said Galloyer, who supplies bread to the residence of President Nicolas Sarkozy. “That weighs on margins because we didn’t raise the prices at first. I thought it would come down by January.”
Since 2007, the price of a baguette at corner bakeries that dot French towns and cities has risen 6.3 percent, according to a study by Familles Rurales.
At larger retailers, prices are up as much as 19 percent.
Les Bles d’Ange, a bakery near the Luxembourg gardens on Paris’ left bank, has marked up its “baguette de tradition” by 5 cents, to $1.60, in response to costlier flour. The cost for a basic baguette was unchanged at $1.20.
“We left the basic baguette unchanged and plan to keep it like that for now,” said Chantal Hanotelle, owner of the bakery, whose name means “Angel’s Flour.” “If prices rise a lot from here, we’re going to have to charge more.”
As millers deplete their stocks of cheaper wheat, they’ll have to start buying more expensive grain, Galloyer said.
Grain stocks in France are sufficient to meet domestic requirements until the next harvest, Xavier Beulin, the head of the French farmers association FNSEA, said Thursday after a meeting with Sarkozy.
