How the Cost of a Loaf of Bread is our Best Global Inflation Indicator

David Ben Horin
4 min readMar 11, 2022


In 24-hours, a loaf of bread cost me 20% more. How did this happen? I don’t live in Ukraine, Russia, or Europe. The global inflation indicator just went red.

“Am I better off with half a loaf of bread?” my friend asks me.

“Why? The bread here is first rate. We live in the wheat capital of the country”

“I had to pay 20% more for a loaf of bread today. Prices just shot up overnight.”

We both know how commodities work, but when something you feel all around you contradicts what you are hearing — even if it’s true, it’s still a little hard to accept.

We live in the Jezreel Valley. This is the wheat capital of Israel. My wife grew up on a farm in the Ukraine. Our favorite watering hole (to actually swim) in located in the center of a big kibbutz (farm).

Every spring we see the wheat. It’s a miracle. A wheat kernel half the size of your thumbnail is planted in the ground, and a few months later it grows into a stalk the size of you, carrying 50 more wheat kernels.

When the wheat is fully grown, it’s like walking through a vault of gold. The ears at the top of the wheat stalk give a golden shine when the sun reflects off it.

The field has millions of wheat stalks. It’s awe inspiring to see so much abundance.

See for yourself:

My wife says we get such a good harvest because we have good “black” soil in here in Northern Israel, just like they do in Ukraine.

Wheat Prices in Ukraine Impact Inflation Around the World

Even in places where there is an overabundance of wheat, the cost of a loaf of bread rises.

Once upon a time commodities were local. If it cost $.22 for a pound of wheat in Spain, fine. If it cost $.10 for that same pound in Canada, then why not get it there?

If you could go from Spain to Canada and back then you are in luck. You can’t so you are stuck with the local price.

That was 100 years ago. Now, we have exchanges where you can buy and sell wheat from one place to another. You can buy your Canadian wheat for $.10, then sell it on the Spanish market at more then double the price.

If that’s the case, why isn’t everybody doing it? Well, they are! Whenever there are price discrepancies, traders will buy at the lower price and sell at the higher one.

They make good money. It’s called arbitrage.

What happens then? The added demand to buy the cheaper version will up the price, and the added demand to sell the more expensive version will lower the price until the two commodities are selling at the same price.

It’s the commoditization of commodities.

It’s the reason why the price of wheat in Ukraine is the price of wheat in Northern Israel. It’s why my friend just had to fork over an extra 5 spot to get his pita bread.

Is Global Inflation Happening Worldwide?

The answer to that question lies in the price of a loaf of bread.

Ukraine is the fifth largest exporter of wheat. If their supply chain is disrupted, we all feel it.

The price of wheat has gone up 67% in the last two months. It is selling at it’s all-time high set in 2008.

The war in Ukraine is disrupting the processing of their wheat crop, impacting 10% of global wheat supply.

Russia is the largest producer of wheat, distributing 15% of global supply. They are subject to sanctions restricting their ability to sell their crops.

One out of every four loaves of bread have been disrupted by a supply chain fracture due to the current war.

This has brought up wheat prices, and everything that is made up of wheat from the cakes you eat at Starbucks to the bun on your burger at McDonalds to the pita bread over a half a billion people in my region of the world eat every day.

Is global inflation happening worldwide? Food is a retail item everyone on earth needs to buy. It is comprised of wheat, and oil?

Oil? The fertilizer that is needed to help crops to grow comes from oil, another major commodity produced by Russia that is subject to sanctions.

Bottom line: Expectations that inflation would subside by the second half of 2022 have exploded like a Ukrainian Molotov Cocktail.

Stay tuned.

David Ben Horin is the trader for The Endurance Investment & Trading Fund. The fund is up 22% for the first three months of 2022. You can find his articles at



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