Ukraine may face bread shortages: the reason identified

There is a real risk of bread shortages in Ukraine, as in June and July, major bread producers were operating at a loss or without profit.

This was reported by Yuriy Duchenko, President of the All-Ukrainian Association of Bakers and Director of the "Kyiv Bread" company, according to Minfin.

Yuriy Duchenko states that flour prices have increased by 50% in the last few months and continue to rise. The cost of flour has risen from 10,000 to 15,000 hryvnias per ton and could reach 16,000-16,200 hryvnias by November. Since flour constitutes about 40% of the cost of bread, and other raw materials, electricity, logistics and packaging have also become more expensive, it is necessary to raise bread prices by 15-20%. Without this, many bakeries may stop production, leading to bread supply disruptions. Some enterprises are already operating on a single shift or are on the verge of shutting down.

According to him, flour prices have increased due to the limited supply of second-class grain needed for bread baking, as well as sellers holding back grain in anticipation of better prices. Flour mills are also incurring higher costs due to power outages, although these have been minor for the bakeries of critical infrastructure.

He notes that bakers cannot raise bread prices in line with rising costs, leading to financial difficulties and issues with fulfilling contracts.

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