LATEST: Bakers cut down bread production, plot RTGS$6 per loaf

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BAKERIES have cut down on bread production amid shortage of wheat and a massive hike in flour prices following the withdrawal of government support on forex.

Most shops in Harare ran out of bread early yesterday morning with reduced supplies received from Proton and Bakers Inn.

The big retailers like OK and PicknPay have also cut down on instore baking as it is no longer economical to sell it at between RTGS2.80 and $3.50 since the price of flour went up almost three fold early this month.

For instance, Blue Ribbon hiked price of 50kg plain flour from RTGS78 to 180 and proposals were being made to charge at least RTGS$6 for a loaf.

Consumers had settled for the instore bread as it was cheaper than the previously popular products from the traditional giants –Bakers Inn, Proton and Lobels.

With the Reserve Bank no longer assisting in the provision of foreign currency, millers and bakeries have to source the much needed US$ from the inter-bank market to source wheat from abroad and they have reportedly been struggling to do so.

This has resulted in the dwindling of reserves.

The other challenge has been the current price of a loaf of bread against the cost of the US$ on both the inter-bank market and even black market, which results in operational losses for the bakeries.

So even those that still have flour stocks are reluctant to maintain their usual production levels to minimise the losses and will only review the supply levels once a price hike is sanctioned.

— HMetro


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