BREAD PRICE HIKE LOOMING

MBABANE – As of Tuesday, consumers may pay 70 cents more for bread if the wishes of the Bakers Association are granted.

The Bakers Association yesterday submitted a proposal to the Ministry of Commerce, Industry and Trade, led by Manqoba Khumalo. In the proposal, the Bakers Association articulated that their application for a bread price review is to mitigate cost increases already incurred as a proactive measure to avoid further closures within the industry. The association submitted that the last adjustment was in July 2022, almost three years ago. It is worth noting that on July 13, 2022, the retail price of a 700g loaf of brown bread was reviewed with a 20.76 per cent increase, resulting in a retail price of E13.68.

This was an increment of E2.35. Meanwhile, the proposed average increase, if approved, will amount to 95 cents per 700g loaf, which is proposed to be implemented in two stages.
“Apart from stable flour and fuel prices (which are set to change), the industry incurred inflationary increases in all other inputs over the past three years,” the proposal reads in part.

Oncrement

This proposed increment adds to the relentless barrage of price increases, adding to the already significant strain on household budgets. This latest blow comes at a time when citizens are reeling from a series of escalating costs, making basic necessities increasingly unaffordable. The blow to consumers, according to the Bakers Association’s two-step increase proposal for bread prices, will see the first rise of 70 cents, which is slated for April 15, 2025, representing a 5.1 per cent jump. A further 25 cents increase, or two per cent, is planned for October 1, 2025. In the proposal, the Bakers Association argued that these increases are necessary to cover rising production costs.

However, this justification offers little comfort to consumers already grappling with a cost-of-living crisis. This proposed bread price rise coincides with the looming 50 per cent hike in bus fares, which will severely impact commuters, particularly those on lower incomes who rely on public transport. Just this month, electricity tariffs saw an eight per cent increase, adding to the burden of already high utility bills while also in December 2024, there was a four per cent rise in water tariffs, further eroding household budgets.

Fuel costs have also surged, with a recent 40 per cent fuel tax addition pushing the total tax component to E5.52 per litre. This stems from a complex web of levies, including contributions to the Sincephetelo Motor Vehicle Accidents Fund (SMVAF) at 42 cents per litre, a Road Agency Fund levy of 40 cents per litre, an Eswatini National Oil Company (ENPC) levy of 35 cents per litre, a fuel oil levy of 50 cents per litre and a fuel tax of E3.85.

Rising

Also, these cumulative increases are occurring against a backdrop of rising inflation, Which is anticipated to reach 5.6 per cent. This means that the real value of wages is shrinking, leaving consumers with with less purchasing power. There is also an impending value-added tax (VAT) hike of 0.5 per cent following the implementation by Eswatini’s biggest trading partner in the upcoming months. On the other hand, the Eswatini Bakers Pricing Committee said: “We trust that the request will be seen as fair and conservative, being well below the average three-year inflation rate and even lower when compared to neighbouring countries’ promotional prices.

Thanking you in advance, and we look forward to prompt approval.”
If the proposed increment is permitted, an individual buying a brown loaf of bread daily will now spend E36 more per month. As the cost of a 700g loaf of brown bread has been hiked from E13.65 to E14.40, it will now require a monthly budget of E446.40, which has escalated from E410.40 by E36 per month.

Post your comment

Your name:

Your e-mail address:

Add your comments:

Please enter the code you see in the image:

Image:

Code: