Small bakers squeezed

2008-01-16 00:00

SMALL bakeries will continue to be subordinate to bigger milling companies as long as no regulatory measures are put in place to control the wheat industry, a local bakery said yesterday.

The bakery owner, who spoke to The Witness on condition of anonymity, said the increase in bread price is unjustified following the fluctuations in the price of wheat last year.

While for most of 2007 the wheat price was R3 300 per ton, that decreased to R2 900 per ton, and since December last year the price has remained at R3 100 per ton.

The baker was speaking following the announcement by Tiger Brands that it was increasing its bread price by 40 cents. He said that the Wheat Board, which used to govern the wheat industry, dissolved causing a number of negative factors to infiltrate the industry. He said that while the board was in operation, prices were regulated satisfactorily.

“If we as small bakeries were to challenge the monopoly of the bigger companies like Tiger Brands, Pioneer Foods and Premier Food openly, we would no longer be supplied with flour,” he said.

The small bakeries rely on the very same competitors to supply them with flour and they determine the prices. He said a single 50-kg bag of flour costs R245. Also, the three giants have their own bakeries, said the baker.

He also said the the big companies have unfair advantage in that they collude with supermarkets, which buy their breads in bulk.

“At the end of the day, it’s the person on the street that has to suffer the consequences of this. Supermarkets also bully us out of the shelves by asking to buy space … The supermarkets have their in-store bakeries too and their breads are priced to bully out the small bakeries,” he said. nathi@witness.co.za

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