Wheat price down, bread stays up

Press, 20 September 1985, Page 1

Wheat price down, bread stays up

Bread prices seem unlikely to fall immediately, in spite of a significant reduction in the price of flour.

The Wheat Board said yesterday that its selling price for flour in bulk and sacks would drop ?30 a tonne from Monday. “Thirty dollars a tonne in the cost of flour is understood to relate roughly to about 2c a loaf in bread prices,” said the board. None of Christchurch’s four main bakeries — C. E. Boon, Ltd, Brooklyn Bakeries, Ltd, Stacey and Hawker, Ltd, and North’s Bakery, Ltd — has said yet that the price of bread will drop. The president of the Association of Bakers, Mr Malcolm North, said he could not predict the effect on retail prices, as every bakery was faced with varying circumstances, and must make its own pricing decisions.

“However, because of cost increases already in the pipeline I would expect that many bakeries would not reduce their price,” said Mr North. Increases in the cost of flour are often cited by bakers as a reason for a rise in the price of bread, which costs between 99c and $l.lO for a standard-sized loaf.

Christchurch bakers say that old stocks of flour, bought at the previous price, would have to be used before any drop in the bread price could apply.

The manager of C. E. Boon, Mr Adrian Jackson, said yesterday that he could not say yet whether the company would drop the price of bread. It had not tried to recover increased costs in other parts of its business. As well, Mr Jackson said that he disputed the Wheat Board’s assertion that the new price of flour would relate to about 2c a loaf, and said that it would be closer to 1.5 c.

Mr Rodger Curragh, who manages Brooklyn Bakeries, said yesterday that he had not heard of the drop in the price of flour. It was up to the company’s board of directors to decide whether a drop in the price of bread should follow, he said. \ A spokesman for Stacey and Hawker said that he was not aware of the fall in price.

The reduced cost of imported wheat was the main reason for the drop in the price of flour, said the general manager of the Wheat Board, Mr A. G. Elliott.

The cost of imports was expected to be lower than earlier expected because of the strengthening New Zealand dollar and the “generally bearish” • nature of world wheat prices since the start of the year. Mr Elliott said that the board had this year imported 37,000 tonnes of Australian wheat from an expected total amount of 78,000 tonnes.