Flour price hike: Anxiety heightens over looming bread scarcity

Bread is staple food in Nigeria, however, with the recent hike in the price of flour and other basic ingredients including sugar, its cost is fast getting out of reach of the common man, even as anxiety heightens over looming bread scarcity, KEHINDE OSASONA writes.

Bread is a staple food in most Nigerian households, regardless of social status, just as bakeries in Nigeria employ millions of Nigerians directly and indirectly, making it a key employer of labour in the country.

However, most bakeries have continued to close shop bowing under the weight of the high cost of producing bread, cake and other pastries.

Blueprint Weekend checks indicated that from Abuja to Lagos, prices of bread have not only increased, but the cost of baking cake and other pastries have also risen astronomically.

This is no thanks to global wheat value chain disruptions which economic analysts have attributed to the Russian-Ukraine War.

Russia and Ukraine control 25 per cent 25 per cent of the global wheat supply and 15 percent of barley.

Significantly, the Russian-Ukraine War may have led to rise in the price of wheat, barley, maize and edible oil, among others, produced by the two countries with mostly African consumers at the receiving end of the after-effect.

The Russian-Ukraine region accounts for a large amount of wheat production, which was a key input in food value chains which many Africans including Nigeria, who are heavy wheat consumers, relied on for bread, spaghetti, noodles, biscuits and other flour-based products.

Price hike

Investigations by our correspondent revealed that the price of flour which is the major ingredient baking had been jerked up from N10,700 per 50kg bag two years ago to N27,500 to N28,000 per 50kg bag, while sugar increased from N13,500 per bag in 2020, to as high as N30,000.

Baking butter was also hiked from N5,800 to almost N14,000; just as a 25-litre-can of vegetable oil which was about N13,000 now sells for N25,000 and milk which was sold for N30,000, now goes for N65,000 to N70,000.

Looming food crisis

Shortly after the Russian-Ukraine war broke, the Chief Executive, Dangote Industries, Aliko Dangote, and Chief Executive Officer, Flour Mills of Nigeria Plc, Boye Olusanya, had raised the alarm that the war would affect the wheat supply in Nigeria and could trigger a major food crisis.

Corroborating his assertion, data from the National Bureau of Statistics (NBS) indicated the average price of sliced bread (500g) increased 34.98 per cent year-on-year, from N331.76 in March 2021 to N447.80 in March 2022.

What it means is that on a month-on-month basis, the average price of the item increased by 2.23 per cent, with indices far above the average food inflation rate.

Bakers ordeal

Speaking exclusively to Blueprint Weekend in a telephone conversation, a Lagos-based baker, Mr Segun Adebayo, described the situation as worrisome, and implored the federal government to wade in.

Adebayo, who owns God’s Blessing Bakery in Abule-Egba Area in Lagos and also a member of the Premium Bread Makers Association of Nigeria (PBAN) and the Association of Master Bakers & Caterers of Nigeria (AMBCN), said in his close to 40 years experience in the industry bread business has never suffered the way it is suffering presently.

He said the bakery business was dying slowly and multitude was closing shops, adding that many of his members, who could not afford the weekly wages for workers, were no longer in business today.

According to him, “Persistent high prices of flour and other ingredients are getting out of hand. Flour is about N27,000 to N27,500, sugar is about N20,000, butter, yeast, fuel to power the grinding machine and wood are also there.

“And if you are using an electric oven, you still have to power it. All of these are very costly now as I speak to you.

“In the baking business or bread production, there is what we call distribution of labour. If you are producing a bag of flour for instance, you need to employ about three workers. You have the cleaner, miller, the baking section, selling section, packing section, nylon section and supplies.

“All these go into the cost of production and the cost of production today for one bag is N50,000 plus.

“Before now, I was producing 10 bags on a shifting roll so that others could also produce, but now, I can barely produce three to five bags. That is to tell you that some of us are just still hanging in the business just to answer the name ‘baker’ and nothing more.

“After production some times, having deducted the production cost from total cost, the remaining amount would not even be enough to buy materials for next production, not to talk of paying the workers, it is that bad.”

Speaking further he said, “Going forward, I think our government should empower individuals and the baker association financially to be able to engage in plantain plantation to produce flour and stay in business.

“Apart from that, they should also encourage plantain flour bread production like we have the cassava bread. According to research, it is not only healthy; we learnt that it is also cost-effective. Come to think of it, the so-called imported wheat flour is not as it used to be again. I mean, why can’t we go back to locally made flour and save cost and build our local economy?

“Again, the government can embark on mass production of sugar-cane to bring down the price of flour. I think these suggestions should be given a consideration.”

Another baker, Mallam Ismaila Adio, who also spoke exclusively from Ilorin, told this medium that he was considering staying out of the business by the end of 2022 as the environment is no longer friendly.

Mallam Adio, who started the business some 12 years ago lamented that the experiences of the last four years in the business has discouraged him completely.

“Frankly speaking and by the grace of God I made profit from the business at first and I can point at some little things I was able to achieve. Lately, it has been hell of a business. It is as if we are just in business so that people won’t ask us: where is bread today?

“Did you know that at one point I had to start living on loans to produce bread so that my customers won’t leave en masse?”

Adio said master bakers including him would not have choice but to continue to increase product prices until the situation normalises.

Consumers lament

For some consumers, who spoke to our Correspondent, bread remained their delicacy. They, however, decried the looming scarcity as a result of the high cost of production.

One of them, Toluwani Asade, who works in Gwarinpa told this medium that she would not miss her morning bread and tea whether at home or in office for anything.

According to her, “Even when bread was scarce, I was ready to buy at any price just to keep up with the tradition. That’s to tell you my love for bread and pastries alike.

“But as it were, we are all in it together as not all consumers can afford this monthly increase in price of bread amid scarcity because our purchasing power differs from person to person.

“I do not know how we got here at par bread price. It is sad that one cannot just walk out and buy a loaf of bread for as low as N100.

“Most bakeries don’t produce N100 bread again while others fix prices from N500 for a loaf of bread. Today, a family-sized loaf is now N1,000 and even at that it cannot go round a family of four.”

Also speaking, a shop owner Hajia Aisat Gbadamosi, who plies her trade in the Jabi Area of the FCT lamented that bread was now for the rich.

When our Correspondent probed further, she said, “I am a bread seller and I used to collect more bread from bakeries and sell it with butter. Lately, I collect less bread from the vendors or I won’t collect at all because there is no market like before.

“While some customers will complain that the bread is small, others might say the ingredients are not in the bread like before, those are the things we experienced.

“As a way out, I have resulted to selling bons, puff, puff and other pastries in the morning because no matter what small children will force their parent to buy while going to school.”

Whither FG’s intervention?

The federal government had earmarked a 15 per cent budgetary expenditure for the national wheat development programme as well as a 5 per cent tariff on wheat imports.

Years later it could be argued, based on feelers and stakeholders reaction, that there has been little or no significant benefit in the wheat supply chain.

However, at the Capacity Building for Master Bakers on the use of High-Quality Cassava Flour (NQCF) for baking bread and other Confectioneries in Kano state, last year, the Director, Federal Department of Agriculture, Mrs Karima Babangida, said the federal government was set to create jobs, wealth and save Nigeria FOREX spent on importing wheat.

According to her, the present administration’s agricultural policy would enable stakeholders to achieve export substitution, job creation, economic diversification as well as food and nutrition security.

She said, “The promotion and adoption of 10 percent Cassava flour in bread and confectionery making so as to reduce wheat importation of the Federal Government has been going on with mixed feelings.

“The policy has the potential to generate massive employment, save approximately a large percentage of billions of naira daily in wheat import provide huge foreign exchange, create massive wealth among average Nigerians and eliminate hunger in the community,” she said.