Flour costs to trigger bread price hike

BAKERS are considering hiking the price of bread following the inflated cost of flour by local millers.

National Bakers’ Association of Zimbabwe president Mr Givemore Mesoemvura accused millers of increasing the price of bread flour by deliberately taking advantage of Government’s decision to include the commodity under imports restrictions.

The price of flour has risen from $27 to $32, an increase of about 19 percent.

“Over the period of the introduction of Statutory Instrument (SI) 64 of 2016 there has been a price increase in bread flour by local millers, which has no justification serve only for the fact that there is a regulation protecting them from competition,” said Mr Mesoemvura.

He said flour was the main ingredient in the production of bread and its increase leaves bakers with no choice but to also hike the cost of their product.

“Flour is the prime ingredient of making bread and the rise in the price of the ingredients will obviously affect the price of our product, which is bread. Flour is 83 percent of the ingredients that make bread,” Mr Mesoemvura said.

Mr Mesoemvura also raised concerns that some local millers were running out of stock and are likely to fail to meet market demand.

“We have had incidences where some millers would run out of stock and we fear that they might not be able to meet demand. Some of them have not bothered to improve on the quality of their flour due to lack of competition,” he said.

Double Fresh Bakery managing director Mr Mnothisi Nsingo said the increase in the price of bread flour puts bakeries in quagmire in the wake of the prevailing liquidity crunch in the country.

“We were surprised when the price of flour went up two weeks ago as we were aware that the price of wheat had not increased. When millers reduced prices sometime ago, the bakers also reduced prices. Now we are left in a hotspot on whether to increase bread prices in a tough environment like this where we are faced with the current cash shortage situation in the country,”

National bread consumption has fallen sharply to under one million loaves per day from around 1,5 million about five years ago. This translates to a bread flour requirement of about 400 tonnes of flour against an aggregate national installed flour milling capacity of 2 100 tonnes per day.

In this regard, the millers said continuation of bread flour imports is self-destructive because current national bread flour demand is less than 25 percent of national installed flour milling capacity.

In a letter to Industry and Commerce Minister Mike Bimha, dated August 22, 2016, Grain Millers’ Association of Zimbabwe chairman Tafadzwa Musarara said the import control measure fully complies with the expectations of international law and in particular Article 20 of the Sadc Consolidated Trade Protocol. However, contacted for a comment on the recent bread flour increase, Musarara professed ignorance demanding to know “specifics of affected bakeries and from which supplier”. Business