Russian Bread Makers Plan To Raise Prices: Report
Several Russian bread producers have told retail chains they plan to raise prices by 7-12% from August due to higher production costs and the limited effect of state support, the Kommersant daily reported on Monday, citing industry sources.
Russia, one of the world's largest wheat exporters, has introduced a series of grain export curbs and retail price caps on sunflower oil and sugar since late 2020 that it hopes will help to reduce high domestic food inflation.
While retail prices for sunflower oil and sugar were stable, they have risen for bread producers, some of them told Kommersant. Prices for margarine, packaging and transportation costs were also up, they added.
Russia's agriculture ministry sees no reason for a significant increase in bread prices because domestic prices for wheat are down 7.2% so far this year, it said in a separate comment on Monday.
Russian prices for bread made from wheat flour are up 4.6% since the start of 2021, it added.
The agriculture ministry said bread producers were getting state subsidies in exchange for not raising their prices - 2 roubles ($0.027) per 1 kg.
However, bread producers told Kommersant the subsidies met only part of their rising costs, and that some of them had decided not to seek them.
In January of this year, the Russian government formally approved a proposal to impose a higher export tax on wheat from 1 March, in a bid to curb rise in domestic food prices triggered by the COVID-19 crisis.
World food prices rose in May at their fastest monthly rate in more than a decade, posting a 12th consecutive monthly increase to hit their highest level since September 2011, data from the United Nations food agency showed.