Do you know the reasons why a loaf of bread costs RD$7 in the Dominican Republic?

A turbulent international market of prices, where the value of raw materials (wheat, flours and wheat bran) is on the rise, to which is added the increase in the price of oil and its derivatives that also impact the cost of production of Dominican industries, once again affect the pocket with the purchase of water bread or “sobao” bread.

Ana, a domestic worker and single mother, did not even flinch yesterday when she bought two loaves of bread for RD$15 from the street baker in the residential area where she works. This has become normal for about a month now.

A loaf of water bread costs RD$7 in some places, but the baker says that for the last month he has been selling them “at two for 15”. The same price is charged for groceries.

In February of this year, the members of the bakeries went so far as to sell bread for RD$5 per unit up to RD$10, a measure that was rejected by many because the people rejected them and registered losses for those who kept the bread expensive.

The authorities and the Unión Nacional de Pequeños y Medianos Industriales de la Harina (Umpih) agreed in February to a subsidy of RD$500 per sack as compensation so that the product would not be increased in price.

In June the Umpih denied the increases and called the bakers’ attention to the fact that the increase was not justified by this compensation. In August of this same year, the Ministry of Industry and Commerce and Mipymes (MICM) and the National Institute of Price Stabilization (Inespre) agreed to sell bread in popular markets. The subsidy was to come from the MICM to prevent bread from rising again.

In the meantime, the bread has gone up in price again, the baker rattles around the neighborhood on his bicycle without mentioning the price and he has only received RD$1 more for the day’s sale. He sells the equivalent of 40 to 50 pounds of flour per day and his profit is limited to 12% of that sale.

The MICM website preciosjusto.com only lists the price of whole wheat and white bread sold in supermarkets, with values from RD$35.99 to RD$96.65 for a weight of 550 grams to 1,265 grams.

The ProConsumidor portal, which also monitors the prices of items in the Dominican basic food basket is outdated and only collects the prices of bread from the 3rd to the 9th of the week of this September 2021. The case of 10 sobaos bread units were worth on that date from RD$60 to RD$78.00. The sleeve of 10 loaves of water bread cost from RD$49.45 to RD$50, which means that they maintained their price of RD$5 a unit in most supermarkets in the Capital.

Factors
The cost factors are the same: increases in the prices of commodities (wheat, flour, wheat bran, corn, fuels, maritime transport-freight and local transport by trucks, gas in the industries, electric energy, among others which, according to Luis Miura, president of the Dominican Confederation of Small Businesses (Codopyme), “there are many ingredients involved”.

He believes that in his opinion the price of bread has been allowed to slide and that is why it is today at RD$7 per unit.

By not locating the president of Cooproharina, nor of Umpih, Miura explained that it is about business and the price has been left to take its level, in addition to the fact that the price has not moved for 13 years and now there are increases in raw materials, freight and commodities that have made “a perfect storm”.

He specified that the increase is not due to the domestic market, “but rather to the international market”.

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