Industrial bakeries fear short-term price explosion of bread

Industrial bakeries fear short-term price explosion of bread
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Large bakeries in Belgium are facing serious consequences as a result of the war in Ukraine and soaring energy prices, and fear a price explosion due to disruptions in the supply of raw materials and higher costs.

The Federation of Large Belgian Bakeries (FGBB) said on Friday that the price of bread will sharply increase in the short term.

As historically high energy prices cause serious inflation and supermarkets fear shortages and price increases, the price of bread was already set to rise €0,30 - but it seems that increase might be even sharper than expected.

“Due to the pandemic and various logistical challenges, the supply of raw materials was already difficult before, but today with the conflict, we fear a further profound disruption in our production capacity," the federation said. "Additionally, the costs of transport, packaging and production of flour and bread are also increasing."

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As Europe gets a significant amount of its wheat from Ukraine and Russia, the war is causing serious disruptions in the import of those products. “The fertilisers and phytosanitary products, fuel, and labour necessary for a good harvest are becoming scarce,” the FGBB explained. “The question arises as to whether the farmers of the region will even be able to work the land and if there will be enough seedlings.”

At the same time, demand in the local and European markets has increased significantly, particularly in countries that were previously sourcing almost exclusively from the Black Sea region.

“Although our suppliers have sufficient flour stocks for the next few weeks, we fear that due to this increased demand, the prices of flour and many other raw materials will explode very quickly,” the FGBB said.

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