Bread price goes up

HARARE - The price of bread is going up by 10 percent with effect from today due to an increase in the price of wheat — a key raw material in the manufacture of bread.

This comes at a time when millers are frantically making logistical arrangements to bring in a consignment of wheat which had been held up in neighbouring Mozambique to avert bread shortages that were starting to emerge.

National Bakers Association of Zimbabwe (NBAZ) president Ngoni Mazango, confirmed to the Daily News yesterday that it had become necessary for bakers to increase the price of bread to keep the industry viable.

“As an association, we were loud and clear that the prices of flour are going up,” he said.

Figures obtained from the Grain Millers Association of Zimbabwe (GMAZ) indicate that the price of wheat has in the past 90 days increased by about 10 percent from $375 per metric tonne (MT) to $415.

As such, the cost of production in the manufacture of bread has also gone up, resulting in bakers passing on the increase to the consumer.

The Daily News is in possession of a letter from Innscor Africa Limited, which controls the country’s largest bakery, Baker’s Inn, alerting retailers of the increase in the price of bread.

“This letter serves to inform you that the price list for Innscor Africa Bread Company Zimbabwe (Private) Limited trading as Baker’s Inn Bread effective Saturday 15 September 2018 will be as follows: standard loaf all variants per unit $1 (wholesale delivered price), $1, 10 (recommended retail price),” the letter, dated September 13, 2018, reads in part.

According to GMAZ chairperson Tafadzwa Musarara, the El Nino-induced weather conditions in the western world have impacted negatively on global wheat production in countries such as Germany and the United States.

He said this has resulted in supplies being revised downwards, which has increased the prices of wheat in the global market.

“Russia, arguably the world’s second wheat exporter and a major source market for Zimbabwe, has cut its exports quota. The unfolding geo-politics around trade tariff wars are not making the situation any better,” he said.

Musarara said the entire African continent remains a net importer of wheat, as more people are now consuming wheat products and Zimbabwe was not an exception, as its wheat cannot, alone, be used in bread making.

He said local wheat was only used for biscuit and self-raising flour production.

“We require $13 million every month for wheat – the whole country — so that we are able to produce bread flour, self-raising flour and an initial payment of $5 million was done…the national wheat requirement is currently standing at 38 000 tonnes…,” said the GMAZ chairperson.

Zimbabwe is currently experiencing bread shortages owing to the short supply of wheat, which is being held up in neighbouring Mozambique.

Owing to the shortages of wheat, six milling companies have suspended operations, namely Victoria Foods, Uni Foods, Wheat Star, Power Foods, Falcon Foods and Oriental Milling.

On Thursday, Musarara said the Reserve Bank of Zimbabwe (RBZ) has made a commitment to pay for the wheat held up in Mozambique to the supplier, Holbud Limited, so that it can be released as soon as possible.

Wheat is one of the products that are on the RBZ’s priority list in terms of allocation of foreign currency, which is paid directly to the suppliers.

Musarara revealed on Thursday that GMAZ has negotiated Holbud for a pre-clearance of the shipment, adding that the first supply of wheat was expected in the country early next week.

He said the situation needs immediate intervention such that GMAZ is planning to deploy 100 trucks to complement rail transport to bring in the wheat from Mozambique.

“It’s a process of between 14 to 21 days, but as the stocks come in — because normally the National Railways of Zimbabwe brings about 1 400 tonnes a day and daily consumption for bread only is 700 tonnes and we probably need 1 200 tonnes — so as the wagons roll in, we will be offloading, we continue milling.

“We have made a provision for the trucks, it’s an expensive option but it’s for the first few shipments, so that all other milling companies that have suspended operations can quickly resume,” he said.

Meanwhile, Musarara also disclosed that the grain milling industry was currently saddled with an $87 million foreign debt for wheat, rice and salt imported into the country.

“This debt is accruing $400 000 monthly on interests, creating inflationary pressures towards product pricing. We wait with abated breath the full text of the proposed currency reform and hope that our outstanding nostro liabilities will be ring-fenced against exchange losses,” he said.

He said at least $20 million was needed on time and in full to pay for wheat, rice and salt imports every month, adding that this is necessary to enable people to have sufficient supplies during the festive season.

Comments (2)

we shouldn't be importing wheat. We have had fools for leaders hence our sorry state. Zanu should never ever be allowed anywhere close to power. They're a bunch of fools who have left us holding a snake for 38yrs. Nothing works in this country. We are dying of cholera and have become refugees in villages in Botswana. We must be ashamed.

Moe Syszlack - 15 September 2018

we shouldn't be importing wheat. We have had fools for leaders hence our sorry state. Zanu should never ever be allowed anywhere close to power. They're a bunch of fools who have left us holding a snake for 38yrs. Nothing works in this country. We are dying of cholera and have become refugees in villages in Botswana. We must be ashamed.

Moe Syszlack - 15 September 2018

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