BULAWAYO – Bakers Inn says it is raising the price of its bread by $0.10 on Saturday, up from $1, citing a shortage of wheat.
Rival bread maker Lobels has shut down one of its plants in Bulawayo and is now “rationing” retailers after a reduction in production.
The crisis has been caused by the depletion of wheat reserves in the country, and the Reserve Bank of Zimbabwe’s failure to make foreign payments to suppliers.
In a letter to retailers on Thursday, Innscor Africa Limited – the owners of Bakers Inn – said their new recommended retail price for bread was $0.10.
Rivals Lobels and Proton are expected to follow their lead.
In Bulawayo, Lobels has shut down Silo Plant 1 which produces half loaf and tea loaf. Plant 2 for standard loaves is still operational but running at below capacity following a reduction in production.
“We are rationing customers,” an official said.
Tafadzwa Musarara of the Grain Millers Association said Friday they had negotiated for the movement of 30,000 tonnes of wheat to Beira port in Mozambique on a pre-payment arrangement.
He said the Reserve Bank would be making a payment Friday so that the wheat can start moving by rail and road next Monday.
Musarara said the country was left with 26,500 tonnes of wheat, which was less than a month’s requirement estimated at 38,000 tonnes. He said the milling industry was saddled with an $87 million foreign debt to wheat, rice and salt foreign suppliers.
“This debt is accruing at $400,000 monthly, including interest, creating inflationary pressures towards product pricing. We wait with bated breath the full text of the proposed currency reforms and hope that our outstanding nostro liabilities will be ring fenced against exchange losses,” Musarara added.
