Apr 3, 2008

We pay dearly for our daily bread

By Bil Paul

I was in the checkout line in Molly Stone's the other day when a young, blue-collar man just ahead of me started digging furiously in his pockets. I soon gathered he was trying to find enough money to pay for his only purchase: a loaf of bread. He was surprised that the loaf was going to cost him over $4, and so was I. I was about to offer to pay the difference for him, but he did finally find enough spare change.

Four dollars a loaf? I don't buy bread often, but when I did, I never looked at the price. I just picked up my Oroweat or some other health or artisan bread and assumed the price was two dollars or so. Now I know better.

The price of the wheat, which becomes flour, which then contributes to the cost of bread, has taken a sharp surge over the past year, and government manipulations are partly to blame. To become more "sustainable" (today's big buzzword) and move away from using foreign oil, the federal government began to subsidize the production of the biofuel ethanol, which is made by fermenting corn. Ethanol can be mixed with gasoline to run cars. This has been a growth industry, but has been increasingly controversial because more and more corn is being grown and diverted to it, and farmers have been planting less wheat and soybeans.

Also, foreign countries have been buying more American wheat because the declining value of the dollar made it less expensive.

With less wheat available, the laws of supply and demand performed perfectly, raising the price of wheat and wheat flour. The winners are the farmers, who for years have had to struggle with the overproduction of dairy and grain commodities, and got the government to guarantee the price of some of them. The government itself bought oversupplies of things like butter, and gave it to schools and nonprofits. Back in the 1950s the government even paid farmers not to plant crops in what was called a soil bank program.

But that era seems to be changing to an era of more food scarcity, which, along with the rising price of gasoline, fuels food price increases.

To return to bread, I talked with several local bakers about how they're dealing with the high price of flour. Juan Arteaga, who runs a bakery, restaurant and grocery store in Redwood City, said he hasn't raised prices on bread yet but will probably have to. He did add that in his other operations, he was having to pay a $15 gasoline surcharge for every liquor delivery and a $60 gas surcharge for every grocery delivery.

Mike Rose, the man working with bread recipes and techniques at Semifreddi's Bakery in Emeryville, says flour prices tripled since January 1, forcing an eight percent price increase in bread to retailers. The price of poppy seeds tripled as well.

Thomas Grauke, owner of Moonside Bakery and Cafe in Half Moon Bay for 14 years, just had to raise his bread prices five to 10 percent. The eggs he uses have gone up 23 percent over the past several weeks and the nuts used in pastries have gone up as well. He and his wife had to close down a satellite bakery-cafe in San Mateo last year because it was difficult to earn a profit. When I tried to contact other local bakeries, I found several had closed as indicated by no-longer-functioning phone lines.

I've heard it said that flour and other ingredients constitute 25 percent of a bakery's expenses, but for some, that number is increasing to 35 percent. Bakeries also have to pay all the usual business expenses, including delivery costs (going up due to the price of gas) and - not inconsiderable - the losses taken when unsold bread is returned (bread from smaller bakeries not using chemical dough conditioners and preservatives has a shelf life of only one day).

I researched the pricing range of big-bakery, mass-produced white bread and found the absolute best price at Costco. There, if you buy a minimum of two loaves, the cost of a single 32-ounce loaf is $1.75. Moving over to Safeway, a 22-ounce loaf will cost you $2.19. At Molly Stone's, the price of the least expensive loaf (20 ounces) was close to $3.20. From there, prices escalate up through the $4 range as one picks whole wheat and multigrain loaves and the various artisan breads sold in paper bags.

As a comparison, I looked at making your own bread at home using a bread machine, which can be purchased for as little as $45. If you buy your yeast and flour in bulk at Costco (and including the cost of electricity) you can make 20-ounce loaves of white bread for 59 cents a loaf, or for 68 cents using Safeway's least expensive white flour. You measure your ingredients, pour them into the machine's baking pan, push a couple buttons, and an hour or two later you have a fresh loaf of bread. If you want to vary the shape of your loaf, or make a pizza crust, you can always make the dough in the bread machine and bake it in an oven.

Wheat is the staff of life and bread is a staple of our civilization. "Give us our daily bread" is part of the Lord's Prayer. Western governments are often forgiven by their citizens for making mistakes, but at minimum must ensure the availability of affordable bread. Rioting over bread shortages helped lead to the downfall of Louis XVI and Marie Antoinette and the onset of the French Revolution of 1789. The guillotine took her head. Later, it might have made a good bread slicer.

In Mexico last year, a 400 percent increase in the price of corn flour due too much corn being grown for ethanol production resulted in thousands marching in Mexico's main cities. They blamed the government for the high price of tortillas.



Bil Paul's column appears Thursdays in the Daily News. Reach him at natural_born_writer@yahoo.com.