News / National
No bread price increase, price stays at $1
12 Sep 2012 at 05:34hrs | Views
STAKEHOLDERS in the bread cluster have agreed to maintain the price of bread at US$1 under measures also meant to ensure viability of bakers and millers. Bakers had proposed to increase the price of bread to US$1,20 citing an increase in the cost of wheat, flour and general operations.
The Government, through the Ministry of Finance, had indicated it would not sanction a hike in the price of bread arguing that there was no justification in that regard.
An agreement to maintain the price of bread at US$1 was reached following a meeting convened by the industrial taskforce of the National Economic Consultative Forum.
"Implementation of the adjustments (will) take effect on November 1, 2012 to keep the stability in pricing and supply," said NECF.
Bakers had also wanted the threshold of imported flour to be increased from 30 to 40 percent to keep the bread price at US$1.
"It was unanimously agreed that bread was now a basic commodity and that its price should be affordable to all.
"In some instances, it (bread) has become a full meal for some households, hence its price sensitivity," said the NECF.
Out of the 300 000 tonnes of wheat the country requires, 70 percent would be milled into flour locally while the balance would have to be imported at 5 percent duty.
Flour imports above the prescribed quota would attract 20 percent duty, but the price of local and imported flour would remain at US$740 and US$640 per tonne, respectively.
At a flour price of US$740 a tonne, the wholesale price of bread would be increased from US$1,03 to US$ 1,10.
But recent agreement is expected to assist the milling industry break even while capacity utilisation and employment creation would be enhanced. Stockfeeds would also be readily available at reasonable prices.
Stakeholders were urged to be cognisant of the underlying rationale behind freezing the price of bread to rebuild the economy, create employment, to enhance social cohesion and to take advantage of the dollarised environment.
The stakeholders' meeting noted that millers were, however, failing to meet demand due operational issues, which limited their operations to around 50 percent capacity.
While the country was spending US$27 million to import flour, wheat imports cost only US$19 million.
The Government, through the Ministry of Finance, had indicated it would not sanction a hike in the price of bread arguing that there was no justification in that regard.
An agreement to maintain the price of bread at US$1 was reached following a meeting convened by the industrial taskforce of the National Economic Consultative Forum.
"Implementation of the adjustments (will) take effect on November 1, 2012 to keep the stability in pricing and supply," said NECF.
Bakers had also wanted the threshold of imported flour to be increased from 30 to 40 percent to keep the bread price at US$1.
"It was unanimously agreed that bread was now a basic commodity and that its price should be affordable to all.
"In some instances, it (bread) has become a full meal for some households, hence its price sensitivity," said the NECF.
Flour imports above the prescribed quota would attract 20 percent duty, but the price of local and imported flour would remain at US$740 and US$640 per tonne, respectively.
At a flour price of US$740 a tonne, the wholesale price of bread would be increased from US$1,03 to US$ 1,10.
But recent agreement is expected to assist the milling industry break even while capacity utilisation and employment creation would be enhanced. Stockfeeds would also be readily available at reasonable prices.
Stakeholders were urged to be cognisant of the underlying rationale behind freezing the price of bread to rebuild the economy, create employment, to enhance social cohesion and to take advantage of the dollarised environment.
The stakeholders' meeting noted that millers were, however, failing to meet demand due operational issues, which limited their operations to around 50 percent capacity.
While the country was spending US$27 million to import flour, wheat imports cost only US$19 million.
Source - TH
