Gerald Cunningham, IAMB president, said Irish bakers are ‘very concerned’ that consumers, retailers and politicians are unaware of the extent of the negative impact that Brexit could have on Ireland’s bread industry.
In the event of a no deal divorce – under World Trade Organization trade rules – bakers could be faced with a tariff of €172 ($195) a tonne on flour, not to mention possible tariffs on sugar and other essential ingredients.
According to Cunningham, this could result in a 10% to 15% increase on the price of bread in Ireland.
Ready as they can be
“Bakeries are doing everything they can to prepare for Brexit. They are as ready as they can be,” said Cunningham.
“However, in the absence of any certainty as to the exact trading environment they will face post-Brexit, they don’t know the full extent of the challenges that will have to be managed.”
Historically, Irish bakers sourced 95% of all flour used for making bread from the UK.
However, stockpiling the commodity – as many companies in the packaged sector are doing – is not an option, and plan B – to import it from mainland Europe – will lead to increased logistical costs and interrupted supply from proposed customs checks.
Can’t be stockpiled
“Bread is baked every day; it’s a perishable food and so can’t be stockpiled. It’s also a staple food that consumers rely on to deliver great value at a fair price,” said Cunningham.
“It’s vital for our industry that all borders and ports are free flowing to allow for the continued movement of raw materials.”
The doomsday outlook is similar to the scenario during Storm Emma, which saw frenzied scenes at retail outlets as consumed scrabbled to buy dwindling supplies of bread.
“We are working closely with our suppliers in the UK to minimise any potential impact. But, like most other sectors, there are many factors that are completely beyond our control,” he added.
Zim’s bread shortage
In other news, political instability elsewhere in the world has sent bread prices crashing through the roof.
In the past few weeks, the price of bread in Zimbabwe has risen by almost 70%, thanks to a shortage of foreign currency, which has restricted imports.
To add to the woe, the Grain Millers Association of Zimbabwe has also warned the country only has a week’s worth of wheat left for bread.
A standard-sized loaf of bread currently costs approximately ZW$274.03 (US$0.75), which the average Zimbabwean can ill afford.