The price of bread is set to come back down to about US$1 after the Reserve Bank of Zimbabwe (RBZ) engaged and interfaced with members of the National Baker’s Association. This was revealed by the RBZ on their Twitter handle. If this is successful it will be the second time that bakeries have failed to raise the price of bread above the all-important US$1 mark following another failed attempt back in 2019 following the 2018-2019 drought which resulted in wheat shortages.
PRESS STATEMENT ENGAGEMENT WITH THE NATIONAL BAKERS ASSOCIATION OF ZIMBABWE ON THE PRICING OF BREAD
The Reserve Bank of Zimbabwe (the Bank) wishes to advise the public that it held a consultative meeting with the National Bakers Association of Zimbabwe (the Bakers Association) on 17 June 2022 and deliberated on the cost build-up in the bread value chain.
Taking into account the submissions by the Bakers Association and the need to stabilise the price of bread, the Bank agreed with the Bakers Association that its members would access their full requirements of foreign exchange through the weekly foreign exchange auctions for the importation of inputs and procurement of fuel for the distribution of bread across the country.
In view of the positive engagement with the Bakers Association, it is expected that members of the Bakers Association will review the price of bread downwards. Going forward, the price of bread will be adjusted on account of economic fundamentals that include global price trends of inputs and the movement of the foreign currency exchange rate.
John P Mangudya Governor 20 June 2022
Bakers feel the heat
For the past couple of weeks, a loaf of super white bread has been selling for between US$1.20 and US$1.50 in supermarkets and tuckshops. The price hike was effected by bakeries who claimed that the cost of their inputs had gone up and they also wanted to sell in USD as has become the norm in Zimbabwe. This hike led to a massive drop in sales according to our sources with various bakeries. Every supermarket we visited had various salespeople from the big bakers trying to push sales of their particular brand of bread to no avail. On the other hand, the government has been on an all-out offensive meant to tame the rising prices. Rising prices mean an angry populace and most important an incensed civil service.
So this agreement is a match made in heaven. The Bakers get to sell at reasonable prices that allow them to boost sales. The government get to claim another pyrrhic victory against inflation and perhaps manage to placate the striking nurses and doctors.
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