BY FIDELITY MHLANGA/XOLISANI NCUBE
BAKERS have increased the price of bread, with a standard loaf now pegged at $2,60 or alternatively US$0,90, citing the rising cost of production after government failed to provide support to maintain the current price of $1,40.
This is the second increase within three months and yesterday, the Grain Millers Association of Zimbabwe (GMAZ), a body tasked with importation of wheat for bakers, said the increase had nothing to do with the supply of flour.
“These bread price increases are, however, not in any way associated with flour cost-drivers as the product (flour) supply price to bakers has remained constant. Flour supplies to bakers have, however, remained suppressed due to the non-availability of foreign currency to bring in imported wheat, which is still held in Beira,” GMAZ spokesperson Garikai Chaunza said in a statement.
In November last year, bread was going for $1 and increased to $1,40 retail price after government and the central bank committed to meet 80% of foreign currency demand by the industry, supposing that the price of flour would remain at $36,50 per 50kg.
But government has been failing to fulfil its promises, forcing bakers to act.
Bread is already scarce on the market, and bakers have scaled down production, resulting in long queues in retail outlets.
Due to limited supply, informal traders were now selling bread at $3 per loaf, instead of the recommended $1,40.
NewsDay is reliably informed that government has, for the past month, been engaged in series of meetings with bakers, with a view to ensure they maintained existing bread prices.
According to reliable sources, bakers met the central bank on January 7 and on January 16, held a meeting with Vice-President Constantino Chiwenga, who monitors the food security cluster and presented their precarious position.
They also held a meeting with the National Competitiveness Commission on January 18 this year to try and find a lasting solution.
Bakers are irked by the fact that a number of resolutions such as 80% forex allocation, liquidation of bakers legacy debt of $4,8 million, reduction of flour price made by government to support bakers, have not been
Contacted for comment, National Bakers’ Association president Ngoni Mazango said: “I am in a meeting now. I am not in a position to talk now. You are lucky that I answered your call.”
Between December 2018 and January 2019, the baking industry has received 27% and 9%, respectively, of foreign currency allocations.
According to information at hand, as at January 20, out of the monthly forex requirement of $1,2 million, Lobels did not receive any allocation, whereas Bakers Inn was allocated $100 000 .
Proton Bakers, which needs
$320 000 of forex monthly, was only given $50 000.
Another baker, Bakels Zimbabwe, whose monthly forex requirement is $500 000, was not allocated anything.
Reserve Bank of Zimbabwe governor John Mangudya had not responded to questions sent to him at the time of going to print last night.
Bread is one of the 16 monitored products, which include cooking oil, mealie meal, flour, sugar, rice, salt, chicken, eggs, beef, fresh milk, laundry soaps and washing powder, among others.