Lower global grain production to affect bread prices

TIRANA, Aug. 14 – Drought affecting grain production in some of the world’s top producers this year could cause a new increase in bread prices in Albania which is net wheat and flour importer. Local experts warn Albania will be severely affected in the coming months because of no supporting policies to domestic grain production.
Given the exceptional drought in the US, current crop conditions in other grain producing regions, and the resulting increase in international food prices, the World Bank has expressed concern over the impacts of this volatility on the world’s poor, who are highly vulnerable to increases in food prices. Thus far, crop projections do not indicate the potential for actual shortages in the major grains; however, stocks are low, and the harvests will continue to be dependent upon global weather, which leaves prices more vulnerable to higher volatility. In 2012, prices have risen across all the non-rice grains – wheat, corn and soybeans. Wheat prices are up over 50 percent since mid-June; the price for corn has risen more than 45 percent since mid-June; and soybeans are up almost 30 percent since the beginning of June and up almost 60 percent since the end of last year, says the World Bank.
Bread prices in Albania currently stand at 90 lek for common 0.8 kg loaves.
INSTAT data also show food and non-alcoholic beverage prices have grown by 17.4 percent from 2006 to 2011. Within this group, bread and cereal prices, which make up 15.5 percent of a household’s monthly expenditure, have risen by 50 percent during the past six years. Data show food and non-alcoholic beverages accounted for around 45 percent of monthly expenditure for an average family of four back in 2006 and 2007.