PRESS: Bakeries tell retailers bread prices to grow 7–12% from Aug

MOSCOW, Jul 19 (PRIME) -- Russian bakery plants have notified the retailers that prices for their products will rise by 7–12% from August because of higher prices for raw materials, Kommersant business daily reported on Monday quoting the Verny retail chain.

“The bread producers have warned the retailers that prices for their products will grow by 7–12% starting from August. … The suppliers explain the price increase by more expensive raw materials, packages, and transportation,” Kommersant reported.

Several bakery plants unofficially confirmed the price growth. Alexei Lyalin, head of the Russian Union of Bakers, told Kommersant that the prices for all raw materials used in baking have grown significantly, while the price of bread is only growing by 1 ruble year-on-year. The price of margarine rose by 38%, of packages by 26%, and of sugar by 9%, Lyalin said.

But the Agriculture Ministry said in a statement that the bread prices should not grow significantly. Over the past 12 months, the producers’ prices for wheat bread increased by 4.6%, and for rye and wheat bread by 5.9%, which is comparable with inflation.

Measures of the customs regulation resulted in a 7.2% fall of the wholesale price for 3rd-class wheat compared with January 1, and by 5.9% for 4th-class wheat. The producers’ price for rye contracted by 9.6%. Bakers also often use state subsidies that reimburse a part of their costs, and all companies that receive the subsidies undertook the obligation to hold their prices down. The authorities will provide the subsidies until the end of the year, the ministry said.

(74.1656 rubles – U.S. $1)

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