admin
Africa Moyo, Harare Bureau
THE price of bread is expected to rise marginally to a maximum of $1,40 with effect from today.
This follows lengthy negotiations between Government and the National Bakers’ Association of Zimbabwe (NBAZ), the umbrella body representing the interests of local bakers.
Currently, a loaf retails at a maximum of $1,10 with in-store bakeries charging between 70c and $1.
Bakers had proposed to push the price of bread to $2,20 but Government vetoed the proposal, demanding to know what could be done to keep the price at levels affordable by the ordinary citizen.
Government then moved in to provide more assistance to the baking industry, which has been complaining that most of its inputs requiring foreign currency were now very expensive given the fluctuating exchange rates.
A top player in the baking sector said while bakers don’t directly import some raw materials, the local suppliers are the ones that increased the price in tandem with the shifting exchange rates.
In a statement yesterday, the NBAZ said after realising that bread has become the most affordable staple food for citizens, a decision was reached to make “every effort to keep the bread price affordable”.
“We therefore notify the public that the price of a standard loaf should not exceed $1,30 and $1,40 to the wholesale and consumers respectively, flour being at a maximum price of $36,50 per 50kg bag. This watered down increase has been arrived at following the Government’s intervention through the Reserve Bank of Zimbabwe that has committed to avail to the bakery industry at least 80 percent of its monthly foreign currency requirements from a current maximum of 35 percent allocation,” said the NBAZ.
Although Government’s new offer to bakers could not be immediately established, Industry and Commerce Minister Mangaliso Ndlovu confirmed to our sister paper, The Herald Business, yesterday that “more assistance” is now being provided.
“They really did not need our permission to do that (increase the price), but they notified us. They initially wanted (the price) to be $2,20 (but) then we had to come up with ways of mitigating that and there is now more assistance that they are getting which could not be 100 percent really, to keep the prices where they were. So they told us that with the assistance and having looked at their costs and having looked at everything, the wholesale price from the manufacturers will be $1,30 and from the retailers it will be $1,40,” said Minister Ndlovu.
NBAZ said while previous media stories were “purely speculative”, the industry has been significantly impacted by the recent wave of price increases, particularly on key raw materials used in bread making, and other operational costs.
The organisation said despite efforts by respective member bakeries to slash internal costs and improving operational efficiencies, “the magnitude of the cost pressures has made it impossible for the bakery industry to remain viable given the current challenges”.
According to NBAZ, imported inputs in the bread making and distribution processes recorded astronomical price increases, which exceeded 500 percent in some cases.
“Among other imported items which have increased drastically are enzymes, baking fats, improvers, gluten, calcium, kwiklocks, premix and spare parts for the factories and distribution vehicles,” reads the statement.
The NBAZ said it was grateful for the “cooperation and sympathy” it has received from all players in the value chain who include the Ministry of Industry and Commerce, the National Competitiveness Commission, the RBZ and consumers.
derick.khumalo