Bread price up 17%

Pride Mahlangu, Business Reporter

BAKERS have increased the price of bread for the first time this year by about 17 percent from $18 to $21 for a standard loaf citing increased production costs and challenges in procurement of flour. 

The increase came into effect over the weekend and by yesterday most shops had adjusted to the new price. 

A snap survey by Business Chronicle in Bulawayo revealed that retailers — Greens, OK, TM Pick n Pay, Oceans, Choppies and Zapalala — had already switched to the new price. Brands such as Lobels, Baker’s Inn, Proton and Oceans are being sold for between $20 and $21. 

National Bakers Association of Zimbabwe president, Mr Dennis Wallah, attributed the increase in the price of bread to the challenges regarding the flour subsidy as well as escalating costs linked to foreign currency shortages.

“The price of bread has been stable from November to date. We don’t have subsidised flour available hence the market forces are now at play,” he said.

Mr Wallah said because most of the raw materials are imported, changes in the exchange rate also affect the production costs and this had forced bakers to adjust  prices.

Consumer Rights Association spokesperson, Mr Effie Ncube, said the latest increase means that the price of bread which is a basic commodity, is now beyond the reach of many families.

“We get concerned when families cannot afford basics such as bread as this means these families are now food insecure,” said Mr Ncube.

He said it was important to stabilise the prices of basic commodities so that they remain affordable to many families.

Mr Ncube called for a stakeholder dialogue involving business, Government, labour and consumers to map the way forward.

He said it did not make business sense to produce bread whose price consumers cannot afford.

Mr Ncube said while consumers appreciated that businesses have to make a profit, it was unfair for busineses to charge extortionate prices.

“When you look at the price of bread across bakers, it goes up almost at the same time and by the same margin,” he said.

Mr Ncube said consumers were supposed to benefit from competing businesses charging different prices for the same commodity but this was not the case.

“That is a violation of the laws of the country, the Competitions Act is very clear, you cannot collude to fix a price,” he said.

Consumer Council of Zimbabwe regional manager for Matabeleland, Mr Comfort Muchekeza, said very few families could afford bread at the old price and the few who were still buying the bread will join the rest who had long stopped eating bread following the latest price increase.

“Increasing the price of bread by $3 while many consumers are failing to buy it at $15 is a sad development. 

“The few that were still buying bread will join the rest that stopped buying bread a long time ago,” said Mr Muchekeza. 

He said it was important for businesses to consider the consumers’ affordability when pegging prices so that they continue having customers for their products. — @pridesinstinctz

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