HARARE, March 19 — The price of bread here will go down to as low as 85 US cents a loaf from Friday after bakers, millers and retailers agreed on a reduction following the increased availability of small change, an industry official says.

Since the introduction of multiple foreign currencies in 2009, which involved the widespread use of the US dollar in everyday transactions among the people, the price of bread has generally been pegged at one USD because of a shortage of coins.

The Reserve Bank of Zimbabwe (RBZ) in December last year introduced “bond coins” which have the same
value as the US coins in denominations of one, five, 10 and 25 cents with the 50 -cent coin set to be introduced this month.

The resolution to reduce the price of bread followed a meeting between millers, bakers, retailers and the Reserve Bank of Zimbabwe on Tuesday.

Grain Millers Association of Zimbabwe Tafadzwa Musarara said Wednesday that the price of bread should reflect the new development. “The price of bread is going to come down as from Friday morning,” he told journalists.

“We expect that as from Friday bread prices will range from 85 cents to 99 cents. The reason why bread was all selling at $1 was largely due to issues of change but we now have coins.”

Musarara said the price of bread should also reflect the distance that the retailers were from the bakers.
“Those staying closer to bakeries must also get bread at lower prices,” he said, adding that since 2009, retailers had been enjoying an unfair advantage by simply rounding off prices to the highest dollar.

National Bakers Association of Zimbabwe president Givemore Mesoemvura confirmed that the meeting had resolved that the rounding up of retail prices of bread to one USD was no longer fair and necessary in the light of introduction of bond coins by the Reserve Bank of Zimbabwe,” he said.

Mesoemvura said it was agreed that retailers should strictly apply a mark-up of 10 per cent on bread prices and that the prices should vary depending on the bakers and quality. Major retailers such as Spar, Ok Zimbabwe and TM and bakers including Lobels, Bakers Inn, Mi Brands and Perfect Bakery were reported to have endorsed the price reduction proposal.