Bread prices in Ukraine might grow 20% by end of 2025 - association
MOSCOW. June 11 (Interfax) - The All-Ukrainian Association of Bakers anticipates that bread prices in the country would rise some 20% by the end of 2025, Ukrainian media quoted Alexander Taranenko, the association's head, as saying in an interview.
"I won't be surprised if this happens. Everything points to that," Taranenko said.
Speaking of the expected 20% growth in bread prices, Taranenko said the average factory-gate price for bread is currently slightly over UAH 40 per kilo, while supermarkets have a profit margin of up to 30% by using various marketing mechanisms, although the law stipulates that it cannot be higher than 10%.
"Let's not refer to the national statistics, as it doesn't include the shadow market and other nuances. Objectively, an average Ukrainian consumes 150 to 200 grams of bread a day, which makes around five kilos a month. Hence, an average Ukrainian citizen spends UAH 200 to 210 on bread every month. If the price grows by 20% a year, a person would spend UAH 40 more on bread every month. Indeed, UAH 40 is still money for our pensioners and other low-income groups. However, saying that UAH 40 a month would blow the budget of a Ukrainian family would probably be an exaggeration," he said.
Among the reasons behind growing bread prices, Taranenko mentioned growing prices for all bread components such as flour, yeast, fat, sugar, and so on, plus the costs of electricity, logistics, and the government's requirement that companies critically important for the economy and whose employees are entitled to exemptions from military duty must increase wages to UAH 20,000.
"After tax, people will receive UAH 16,000. Earlier, an average pay in our industry varied from UAH 13,000 to 15,000 to 16,000, regardless of the business. You should agree that this is not a big salary. But when someone says that bakers rake in cash, that's absolutely not so. Increasing wages even by 20% or 30% considerably increases the producer's expenditures, while we can't increase the income," Taranenko said, adding that bread businesses currently have profits just slightly above zero, and they often operate at a loss when it comes to some types of bread.
Taranenko cited the State Statistics Service data showing that over 3,000 bread producers are currently registered in Ukraine.
"Let's assume that not all of them operate these days for various reasons, but even if 2,000 of them do, it's absurd to imagine that all of them have colluded and have super profits now," Taranenko said in countering assumptions that Ukrainian bread producers might have conspired to push bread prices up.
