The Great British Bake Off returns on 26th September. At this time of year, many viewers are inspired to put on their aprons and have a go at making the delicious baked goods they see on their TV screens each week.
However, for consumers, spending on baking ingredients this year is due to be higher. In the last year, the price of eggs has risen by more than 14%, while sugar prices have seen a sharp increase of 31%. What’s more, there are concerns that the cost of wheat, and therefore flour, is also set to rise.
Although other key ingredients have fallen in price compared to this time last year – such as butter, which has seen its price tumble by almost 35% – this is not enough to offset the sharp increases in the majority of these commodities.
Ahead of the 14th season of The Great British Bake Off, Kumar Amit, senior commodity specialist at The Smart Cube, comments on what is causing the increase in the prices of these key baking ingredients:
“Heavy rains in northern Europe coupled with exceptionally wet weather during the UK’s harvest period have stoked concerns about a potential reduction in wheat crop quality. Therefore, milling wheat premium in the UK is expected to remain high. Lower-than-estimated growth in the northern hemisphere’s wheat supply, harvest delays in Europe, and geopolitical tensions in the Black Sea region will further support a hike in wheat prices.
“As such, cumulative wheat output in major producing nations such as the US, Canada, and the UK is forecast to drop 1.5% Year-over-Year (YoY) in the marketing year 2023/24. Ending stocks during this period are also projected to slump 9.6% YoY, increasing the likelihood of wheat prices rising.
“Elsewhere, global sugar prices are likely to remain firm in the short term. This is driven by ongoing dry weather brought about by the El Niño weather phenomenon in key sugar-producing countries, such as India and Thailand, which is set to negatively impact sugar output. In fact, India – the second largest sugar producer in the world – may restrict sugar exports amid the expected drop in production. This is anticipated to cause the sugar market to witness a supply deficit of roughly 3 million tonnes in the marketing year 2023/24.
“A supply shortfall of eggs in the UK is expected to keep prices elevated from September through to November – while The Great British Bake Off is broadcast. Egg farming costs in the UK have increased because of high feed prices and increasing avian flu insurance premiums, which has further affected productivity. Production of egg products in the UK fell 11% YoY in the first half of 2023.
“However, increasing imports from less expensive markets, including the EU and Ukraine, may enable retailers to offer deals or discounts, which could lessen the financial strain on bakers and help in counteracting any significant decline in demand.
“One exception to these increasing prices is butter. Although the cost of butter might inch up slightly in the short term amid a seasonal rise in demand and a projected growth in milk prices, overall prices are expected to remain significantly lower compared with the levels observed in 2022. This is due to sufficient supply and low input costs in the region, which caused butter prices in the UK to fall by around 36% YoY in July.
“For those consumers motivated to try and replicate the mouth-watering baked goods they see on the upcoming season of The Great British Bake Off, spending on ingredients will be higher compared to last year, due to the elevated costs of these key baking ingredients.”