In June 2022, the association of bakers made a decision to go on a two weeks strike to protest the rising cost of wheat flour. This action was intended to push the government to intervene in the rising cost of imported flour due to inflation. Since the year began, wheat has gone up almost 200% from its first price and has led to an increase in bread prices four different times this year.
Ukraine and Russia export about one-third of all wheat products and such a crisis in both countries will affect the bread industry all over the world. Wheat is Nigeria’s second most imported product standing at an astonishing 258.3 billion naira in the first quarter of 2022 alone.
The obvious results show in the prices of bread and other wheat-based foods. In Nigeria, a loaf that was 400 naira before now goes for about 600 to 700 naira. Other confectioneries and wheat-based meals have also been reduced in size or the prices have gone up.
But that’s not all of the problems, every other product that supports production in this industry is on the increase. Diesel that used to go for 250 naira a litre is now at 850 a litre. Others like sugar have also gone up. The burden on bakers still hasn’t been reduced, they are demanding that the government should stop collecting a 15% wheat development levy on imports and have NAFDAC reconsider the N154,000 penalties applied to bakers for late certificate renewal.”
Added to this fact is that importers of wheat flour cannot access forex from CBN so they have to get from the black market because they do not have forex concessions from the government.
The bakers also demanded that the government provide them with grants and soft loans through the Central Bank of Nigeria (CBN) intervention programmes.
The government hasn’t responded to their demands yet but they hope it happens soon.
What the market looks like
What this means is that businesses that flourish on this product have to either lay off workers or reduce production or do both to survive. Others closed down completely because they can’t meet up with demands and the cost of production.
As a baker who only wants to sell bread, Emmanuel Onuorah is passionate about the industry. However, his job is getting harder to do in Nigeria.
“Wheat flour has increased by more than 200% in the last year, sugar by about 150%, and eggs that we use in baking have increased by about 120%,” he claims. We are losing money, he claims. Of his 350 employees, 305 had to be let go.
He is the driving force behind a movement as the president of the Premium Breadmakers Association of Nigeria. He organized bakers in July to take part in a “withdrawal of services” action by closing their shops for four days.
He reveals that so many bakeries have closed down their business. Those still selling cannot increase their prices too much because consumers may not be able to afford it.
Innovate or Die
Some stakeholders are encouraging the bakers to find alternatives to wheat flour. For Food scientists, this is a moment to go back into the labs and find suitable alternatives. At the moment, some bakers like Mrs. Nike Akinriwoye claim that in order to stay in business, she is using local bread ingredients that are less expensive than imported flour. “I tried Sobake (which is defatted soy flour) and discovered that it is fairly nice.
Some others are also considering the suitability of cassava flour as an alternative and potatoes also come into question.
- When will this end?
- Are there alternatives to wheat flour that bakers can utilize to maintain prices?
For a staple that almost every household in Nigeria survives on, we have a serious food crisis on our hands. Some households are quickly removing the staple from their tables and are finding other breakfast options.
The future of the Russian- Ukraine crisis will determine what happens to prices not just in Nigeria but all over the world or maybe we’d just find an alternative to flour.