Bakers announced an increase in the cost of bread production – Kommersant

It is more difficult for bakeries to keep selling prices for bread against the backdrop of rising production costs. Until the end of the year, manufacturers can raise selling prices by 7-10%, said RBC Rustam Aidiev, executive director of the National Union of Bakery (combines the bakery and confectionery plant “Kolomensky”, the bakery and pasta plant SMAK, the bakery “Karavay” and other large manufacturers).

Last time, bakeries raised prices for their products in the spring of 2022 due to “unpredictable jumps in all cost components.” According to Mr. Aidiev, the increase in the cost of production is primarily affected by an increase in core direct costs – an increase in the price of the main raw materials (that is, flour), logistics and workers’ wages. Among the factors influencing the situation, he named:

• an increase in the price of premium wheat flour over the past month: now it exceeds the level of last year by 15–18%;
• agrarians, against the backdrop of rising grain prices, began to hold back sales, and the volume entering the market “in terms of class and quality does not meet the needs of bakeries in GOST baking flour”, which is why a negative scenario is possible – a temporary transition to general-purpose flour instead of baking flour;
• the growth of services and tariffs of transport companies has already reached almost 30% year-on-year;
• the shortage of personnel in the industry, especially production personnel – enterprises are forced to increase personnel costs beyond the indexation: by last year, the increase in the average level of remuneration of workers at enterprises amounted to 25 to 30%, and their salaries were increased at least twice this year (by about 10– 15% in February and 10–15% in July-August);
• the production of inexpensive mass varieties of bread (wheat white and rye-wheat gray loaf and loaf) continues to be unprofitable for enterprises – at the beginning of August, the sales price for such varieties was approximately 20 rubles. VAT included.

“Usually, the increase in bread prices occurred either smoothly twice a year by 3-5%, or one-time by 7-10%. And I’ll immediately focus on the main thing – it’s not about the price on the store shelf that the consumer sees, but only about the selling price of manufacturers,” Ruslan Aidiev added.

The Ministry of Agriculture assures that the domestic market is fully supplied with Russian grain and its products, including bread flour. According to the agency, the cost of wheat flour from producers is 13.2% lower than a year earlier, and the price of food wheat is “lower or at the level of last year’s values” depending on the class.

At the same time, the Ministry of Agriculture confirmed that a significant share of production costs at bakeries falls on the payment of salaries, electricity and logistics. “Currently, the costs in these areas really have a steady upward trend,” admitted the representative of the department.

The Russian Union of Bakers complained that the program to subsidize bread production, adopted in March 2022, does not meet the conditions of the crisis, which led to a sharp increase in all costs of enterprises. In May, the organization applied to the State Duma with a request to increase the size of the subsidy from 2.5 rubles. up to 7.5 rubles per 1 kg, expand it to a wider range, and also give recipients the opportunity to raise prices.

Details – in the material “Kommersant” “Bakers ask for bread”.

Laura Keffer