Although bakeries agree that interest in their products is declining, it is said that it is necessary to increase the price. One of the reasons for the lower demand may have been the wave of popularity of home baking that began at the beginning of the pandemic. “There is a trend for people to bake more at home,” said Radek Žiška on behalf of Karl’s Bakery.
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September prices of food wheat are already CZK 200 per tonne higher than last year.
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According to an internal survey by the Association of Bakers and Confectioners in the Czech Republic, bakers’ operating costs in the first wave of the coronavirus epidemic increased by eight percent. It was mainly the acquisition of protective equipment, drapes and disinfection to ensure maximum food safety, as well as the provision of workers for production and distribution, so that even in difficult conditions to ensure a smooth supply of shops.
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However, the influence of wheat and flour prices due to poor quality harvests is also discussed.
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“There is a surplus of feed wheat and there is pressure to increase the price of food wheat, which is also of great interest abroad. It is not easy to tell us, but the September prices of food wheat are already CZK 200 per tonne higher than last year, “said Pavel Filip, a representative of the Association of Industrial Mills.
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There is a lot of wheat, but it is not high quality
According to him, the results of this year’s wheat crop are good in terms of quantity, but this does not apply to quality.
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According to the director of the Association of Bakers and Confectioners in the Czech Republic, Jaromír Dřízal, flour is an absolutely essential raw material for bakers. “Increasing its price and technological modifications to ensure high quality bread and pastries mean higher costs. This year, the price of yeast has already risen for bakers, which became a scarce commodity during the home baking period, and oil also rose from the main raw materials, ”said Dřízal.
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Behind the rise in price more wages and coronavirus
According to agrarian analyst Petr Havel, however, the grain harvest and its quality will actually have a minimal effect on the price of bread.
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“Unfortunately, it is an overcome cliché that the volume and quality of the harvest fundamentally affect the price of bread and pastries. Although they affect, but much less than in the past, “Havel told the News.
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“An increase in the price of wheat by 1000 crowns per tonne will be reflected in the price of a roll of 10 pennies. And so many prices have not risen so much this year. In addition, most of the grain from the Czech Republic goes to the production of compound feeds – we need less than a million tons of grain for food purposes. Such an amount of quality raw material should be available, “argues Havel.
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In the end, this was largely confirmed by Dřízal from the bakers’ union.
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“The biggest item at the moment, however, is the cost of increasing the wages of workers in bakeries. These have long been severely undervalued and wages in bakeries were only two-thirds of the national average. Every responsible owner of a bakery is aware that without well-rewarded and motivated bakers, he cannot produce quality bread and pastries, ”added Dřízal.
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“Bread and pastries are likely to become more expensive, not because of grain, but because of rising costs, especially for labor, but also because of rising energy, water, rent and additional costs this year in addition to coronavirus, especially for millers. , “Havel stated.
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Petr Bartoň, the chief economist of the Natland Group, also agrees. “It should be noted that the price of flour is only part of the cost of bread. In addition to flour in bread, we also eat transportation, human labor, energy and other raw materials. Transport and human labor become more expensive during emergency measures, making everything more expensive, including bread, ”he told Novinky.
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Costs are rising, sales are falling
“We must also not forget our high inflation – bread should rise by three percent just to ‘keep up’ with rising other goods, and by at least six percent to keep pace with nominal wage growth,” the economist said.
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In addition, bakeries – in connection with coronavirus, among others – saw a significant drop in sales. Some had to reduce production and lay off employees.
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“When the pandemic broke out, sales of our stores in the center of Brno fell to 20 percent. We canceled one shift completely and people were at home, but we paid for it. They began to return slowly, but we still have lower sales. We will increase the price by a few percent. Due to the competition, we cannot afford to raise the price so that it covers our costs, “said the owner of Makovec Bakery Aleš Makovec.
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Decline in interest in rolls and bread
The Křižák Bakery in the Břeclav Region also recorded a decline in demand during the global pandemic. “We have already seen a large drop in sales due to coronavirus and we have halved production,” said production manager Miloš Barvík.
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Matěj’s bakery in Blansko also recorded reduced demand. “We have our own grain repurchase, so the mills grind for us under different conditions. Nevertheless, we are constantly raising the price of the whole year, “said Renata Brychtová, the bakery’s sales director.
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“Since the spring, we have seen a decline in interest in rolls and bread, as well as some special products. For example, of the seven types of multigrain bread, we are now preparing only five. We also reduced the number of employees by ten people, “she added.
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