By MARSHA S. ANDER
Wheat stockpiles in the U.S. have hit a 30-year low, following seven years of world consumption that has exceeded production. Federal projections show America's supply at its lowest levels since the 1940s.
While consumers can reduce their food costs by purchasing less, that's no consolation for local bagel shop and pizzeria owners, who are dealing with skyrocketing expenses.
Peter Rappa, owner of Broadway Gourmet Pizza and Pasta in Hewlett, said that just four months ago he was paying $11 for a 50-pound bag of flour, and now that same bag is costing him $33. Rappa, who has been in business at the same Broadway location with his wife, Anna, for the last decade, said that he has been forced to shop around for better wholesale prices. Small store owners like the Rappas are having to pinch pennies to stay profitable.
Unable to buy flour in bulk, since it won't stay fresh for more than 2 1/2 weeks, the Rappas buy a supply each week, hoping that the price hasn't increased yet again. Even with a small price increase for pizza of 15 cents a slice, they say they are still losing money. "Our business is flour, cheese and sauce," Rappa said.
He added that last year, 50 pounds of cheese cost him less than $80. These days that price has climbed over $100. His wife worries that small pizzerias could someday become extinct. "It's like the little hardware stores that have gone out of business," said Anna. "Where are all the mom-and-pop stores? They're all gone."
For now, however, Anna said she is willing to ride what she terms "this [pricing] roller
coaster."
Making matters worse for the couple, who live in West Hempstead, the price of the natural gas they use to heat their large ovens has nearly doubled over the past year. Peter Rappa said he was paying about $500 per month, but is now receiving KeySpan bills for more than $800. With some quick math, he figured it will take about 80 extra pizzas per month just to cover his gas bill.
Anthony Vicari, owner of C & F Foods Company Inc. in Syosset, one of Rappa's suppliers, said that in the 50 years his company has existed, he has never seen wheat prices this high. "It's not just the wheat, it's everything," Vicari said, describing what is happening in the food industry as "a perfect storm." "All the wrong things happened at the same time," Vicari added, pointing to the devalued dollar, the high cost of dairy products, packaging, petroleum and a drought in Australia.
Vicari's company gets its wheat directly from General Mills, and he said that he recently received notice that there was a possibility of flour rationing, but that has not materialized. His advice to pizzerias and bagel stores is to raise prices aggressively now. "Their food prices have increased 40 percent in the last year," Vicari said.
It appears that most are heeding his advice. He said that he hasn't seen any stores closing up, but he added, "old-timers are starting to get out of the business."
Mario Divella, co-owner of Friendlier Pizzeria on Railroad Avenue in Woodmere, said he has never paid so much for flour since he opened his pizzeria in 1976 with partner Tony Vinceslao. He uses an average of three 50-pound bags of flour per day, and his price has increased to $35 per bag. He had no choice but to raise the price of a plain slice of pizza 25 percent three
weeks ago.
Although Divella checks his weekly food costs, he has no intention of changing his food supplier of 32 years. In just the last month, however, he has noticed that his bill for soybean oil has risen from $16 for five gallons to $29.
Several blocks from Hewlett High School, Mahmood Elsayed, owner of More than a Bagel, estimated that the rise in flour prices is responsible for his losing about $10,000 this year alone. Elsayed, who buys the dough for his bagels already formed, said it used to cost him 14 cents per bagel, and now he is paying 22 cents. Despite raising the price of his bagels 10 cents apiece and $1 per dozen, he doubts he will make up the shortfall. He is now contemplating increasing the price of the butter and cream cheese his customers spread on their bagels.
Richard Byrnes, owner of Bagels Plus in East Rockaway, has seen his flour prices triple in a year. "We had to pass [the cost] on," said Byrne, who last year was charging $6.99 per dozen, and now charges $10.80. "We won't cut back on quality products. There are cheaper products, but we won't use them."
"People aren't buying a dozen bagels, they're buying six or eight," Byrnes added, theorizing that his customers are holding onto their money tighter these days.
Like many shop owners, he also pays a gas surcharge for his product to be delivered. The additional $5 per delivery may not seem like a huge burden, but shops that receive two deliveries per week are spending an additional $520 yearly. That means that Byrnes, who sells a plain bagel for 90 cents, must produce 578 bagels just to cover those charges alone.
"We're hoping it's just temporary, and we're expecting the market to come down," he said, but he acknowledged that prices for raw products are fast to go up and slow to come down. "We'll never see $10 for a bag of flour again," Byrnes said, explaining that he now pays about $30.
He said that his steady customers, many from the Five Towns, had sticker shock initially. "They understand that we can't absorb the cost," Byrnes said. "They hear this on the news. It's not a secret."
Comments about this story? MAnder@liherald.com or (516) 569-4000 ext. 201.
