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Stabroek News

Bread price up - Flour cost increase triggers pastry hike
published: Monday | September 26, 2005

Claude Mills and Robert Lalah, Staff Reporters

JAMAICANS WILL be paying more for a wide range of baked products today.

Bakers, faced with increases in key inputs such as flour, yeast, sugar and energy costs, will be hiking prices between 12.5 and 17 per cent on a number of products.

On average, the new price of a two-pound loaf of bread could hover close to the $100 mark, up from an average of $85.

"We got the news of a 13 per cent increase in the cost of baking flour last Friday. As a result of the combination of this, the fuel bill, the rising cost of the wheat itself, and the hurricanes affecting the shipment of wheat through the New Orleans port, we cannot hold back prices anymore," Clarence Chin, president of the Bakers Association of Jamaica (BAJ), announced over the weekend.

REELING FROM PRICE INCREASE

The BAJ has a membership of 100, but there are about 150 bakeries in Jamaica, in addition to over 60 pastry shops.

"We understand that con-sumers are already feeling the pinch. We traditionally see a decrease in bread sales after every back-to-school period, but it has never been this bad ... ever. With the rise in bus fares, the fuel costs, we are reeling, sales will fall and there are many bakers who are barely breaking even at the moment," Mr. Chin said.

This latest price increase comes in the wake of surging oil prices internationally, and a hike in the cost of bus fares. Still, consumers got some good news only a few days ago when the Jamaica Public Service Company, decided not to increase prices immediately to recover the $457 million approved by the Office of the Utilities Regulations (OUR) for hurricane damage caused one year ago.

CAUTIONED TO BUY WISELY

Contacted yesterday, president of the Jamaica Confederation of Trade Unions (JCTU), Senator Dwight Nelson, said that while he can understand the impact of international prices on these entities, he cautioned consumers to buy wisely.

"Bread is a staple part of the diet of everyone, an increase in these products will have a devaluing effect on the public sector employee," he said.

Jeremy Chambers, vice-president of the Bakers Association of Jamaica (BAJ), contends that since February bakers have been faced with close to 17 per cent increase in the price of flour.

"The last time flour was increased was in April (by 3.5 per cent), but the bakers decided not to pass the increase on to the consumers at that time," he said.

Mr. Chambers said that this time around, bakers will have no choice but to increase their prices.

He explained that based on the 13.2 per cent increase in the price of flour announced on Friday, a baker who uses 200 bags of flour each week will be faced with a $30,000 hike in his weekly flour bill alone.

"And that is only flour. Everything else has also gone up; sugar, beef, shortening, everything," he said.

Individual bakers will decide how much to increase the cost of their products.

"We will have to remember that there is only so much that consumers can take. It would make no use for us to increase the price of our products so much that nobody can buy them," Mr. Chambers said.

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