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Economic update

Updated: Sep 20, 2022

UK Flour Millers economic view was updated on 16 August 2022

Since then, wheat markets have bobbled around the same level, reacting to better news about the situation in Ukraine and worries about a smaller maize crop.

The main movement has been in energy costs where every twist in the European supply situation leads to a big movement in spot prices for gas and electricity (which is priced off the highest cost producer, so moves up with gas prices).

The challenge is acute for flour millers, as electricity is easily our biggest manufacturing cost, but also felt by every business and consumer in the chain. UKFM has been flagging this as an issue for months, and promoting options such as covid style loans and guarantees as ways in which government might help.

We are engaged with partners such as CBI and the Food and Drink Federation in this work, which will hopefully bear fruit in the coming weeks. In the meantime, it would be very good to hear from businesses about their current discussions with energy suppliers to help inform our representational work.


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