The Premium Bread Makers Association of Nigeria has warned that the increase in the cost of baking ingredients may soon warrant an upward review of the prices of bread.
The President of the association, Jemide Tosan, stated this at a press briefing in Lagos on Monday.
“The challenges we face as a result of the incessant increase in the prices of baking ingredients have rendered most premium bakeries comatose making us to operate at a loss,” he said.
The association noted that in spite of the persistent increase in the prices of flour, sugar and other baking ingredients in the last three years, there had been no corresponding increase in the prices of premium bread by the PBAN members.
According to Tosan, the prices of flour had increased from N6,500 to N11,500 per 50kg bag between 2015 and 2018, indicating about 77 percent increase, while the price of sugar had risen by 84 percent in the same period.
He said salt, margarine, yeast and preservatives had recorded 67 percent, 112 percent, 45 percent and 137 percent increases, respectively.
He added that the prices of diesel and improvers used in improving the quality of the bread had risen by 57 and 160 percent, while the price of the bread had only increased by 11 percent within the review period.
“Most of us got loans with double-digit interest rates from financial institutions to fund our bakery projects and are finding it extremely difficult to meet our loan repayment obligations.
“Given the current situation, most premium bakeries may be forced to embark on a price increase, which will further make bread unaffordable to the common man.
“As an association, we are totally committed to ensuring that Nigerians have healthy, quality, affordable and harmless bread on their tables.
“It is in light of this that we appeal to the Federal Government to look into the issues that currently threaten the existence of the premium bakery industry in Nigeria,” Tosan said.
A kind of inflation where the cost of production is on the rise could be described as cost-push inflation.
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