Price of bread shoots up

Source: Price of bread shoots up | Daily News

HARARE – Consumers have been dealt yet another hammer blow after the price of bread went up by 10 percent yesterday.

The sharp rise in the price of bread comes as Zimbabweans are preparing for the festive season, which kicks off this week.

In a letter dated December 15, 2017, Innscor Africa Limited, which runs the country’s largest bakery — Baker’s Inn —advised its customers that the retail price of both a standard and family loaf of bread had gone up by about 10 percent with effect from December 16.

As a result of the increase, a family loaf is now going for $1,10, up from $1 while a standard loaf is now fetching $1 from $0,90 cents.

“Dear valued customer, we would like to notify you that the price of bread has gone up by $0,10 cents with effect from December 16, 2017…The price increase has been necessitated by the increase in the price of our major raw materials,” wrote Innscor Africa Limited general manager, Felix Vazhure.

Given Bakers Inn’s market dominance, other players are likely to follow suit.

Bread is the most common type of product sold by bakers in Zimbabwe and is a considered a “must-have” for breakfast by most families.

At least 70 percent of breakfast diets in the country contain bread. Its daily demand stands at between 800 000 to one million loaves per day.

Bread competes with other starch products such as rice and sadza.

The increase in the price of bread has infuriated the Grain Millers Association of Zimbabwe (GMAZ), the major suppliers of flour, a key raw material in the manufacture of bread.

Tafadzwa Musarara, the national chairman of GMAZ, said the bread price increase could not be attributed “to any increase in cost of flour because there isn’t any increase of that sort.

“The grain milling industry is deeply shocked by the more than 10 percent increase in bread prices that consumers woke up to on Saturday, December 16, 2017. As the suppliers of the major raw material in bread baking, flour, we find the increase unreasonable and devoid of any economic justification.

“Three weeks ago, on the directive of government, GMAZ published its recommended maximum wholesale and retail prices of maize meal, rice, salt and flour. In that published list, bakers flour had (and still have) maximum price to bakers of $32 per 50kg bag.

“The bakers did not object to this price because it is the same price that has been maintained by milling industry for the past five years.

In fact, the three big bakers namely Baker’s Inn, Proton and Lobel’s who control more than 80 percent of the bread market, buy at much lower prices than $320 per 50kg bag,” said Musarara.

He added that consumers have been short-changed during this festive season where demand for bread is at its highest.

“Government has made several interventions which include significant subsidies to wheat prices to millers to ensure that the price of $32 per bag is not breached. This practice is consistent with international best practices in other jurisdictions in an attempt to contain food price inflation.

“Accordingly, bakers have a duty to explain the increase to authorities and the consuming publics,” he said in a statement released yesterday.

Last week, our sister paper the Daily News reported a wave of price increases of basic commodities such as cooking oil, sugar, rice, flour and milk products, hence doubling the cost of living among Zimbabweans.

Two kilograms of plain flour which just last month was costing $1,70 has gone up to $1,99 while the same quantity of self-raising flour which was between $1,89 and $1,99 is now between $2, 07 and $2,29.

Moving on to rice, a 2kg that was $2,85 is now $3,29, 2kgs of basmati which used to fetch around $4 is now around $6 to $9 and Jasmine, which was around $3 now going for between $7 and $7 depending on the brand.

White sugar went up from $1, 95 to $1, 99 while a 750ml of cooking that used to go for $1,35 is now for $1,75.

One litre low fat and full cream milk products that were $1,25 are now $1,49 while another product that used to go for $1,19 is now $1,35 while a bottle that used to be $0,69 is now $0,79.

This also comes as beef has been reported to have soared month-on-month to $7,50 per kg this month from an average of $4,50 in October 2016. The price of table eggs surged from $5 to $6,40 this month.

As reported by the Daily News last week, the fast approaching festive season is set to be a gloomy one for consumers owing to the high cost of basic goods.