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Fuel subsidies, lower tariffs for bakers pushed

The Philippine Association of Flour Millers Inc. has appealed to President Ferdinand Marcos Jr. to extend aid and fuel subsidies to bread makers amid rising prices of wheat and other raw materials globally. 

“We are asking the government if they could extend fuel subsidies to bread makers, too. They use LPG (liquefied petroleum gas) and the price of LPG now is very high at more than P1,000 per 11-kg. Tank,” said PAFMIL executive director Ric Pinca.

SUPPLY DOWN, PRICES UP. Flour prices, on the other hand, continue to increase, prompting a group of small bakers to see a standardized price of regular pandesal at P4 per piece. Norman Cruz 

He said the government should also consider reducing tariffs on other raw materials used for baking.

“That includes tariffs on bakery ingredients such as yeast. We also buy sugar, confectioners sugar, salt, and baking powder. These are things that are not produced locally, so even if we lower the tariff for these ingredients, it will not affect the domestic industry,” he added.

On Sunday, community bakers already asked the government to standardize bread prices to P4 per piece for regular pandesal, or about 100 percent of current prices, amid rising inflation.

Small bakeries led by the Asosasyon ng Panaderong Pilipino (APP) said implementing the price hike will avoid cutthroat competition and allow community bakers to co-exist without harming each other’s livelihood.

Pinca said while the country has enough supply of flour, prices are on the rise amid tight supply of wheat due to Russia’s invasion of Ukraine.

“We won’t see a shortage. There’s just a spike in demand for wheat due to the Ukraine-Russia conflict. What’s happening now is that due to the Ukraine-Russia war, they can’t sell wheat. They hold 30-40 percent of the world’s exportable wheat. Now we can’t access that,” he said.

Last month, local bread makers already warned that prices of budget bread would increase by at least P2 per pack as manufacturers could not keep up with the rising cost of ingredients, especially flour.

The Philippine Baking Industry Group has also asked the Trade and Industry Department if they could raise their prices.

Regular pandesal currently sells at P2 to P2.50 per piece, while jumbo pandesal costs about P5.

APP acting-president Luisito Chavez, however, said that based on real value, the pricing should be P4 per piece for regular pandesal and P8 for jumbo pandesal, all things considered.

Inflation-adjusted, the price should be P5 and P10 each, respectively, he added.

Russia’s invasion of agricultural power Ukraine has severely disrupted the global wheat market, prompting warnings that the conflict could lead to hunger in some countries.

According to the Philippine Statistics Authority, the country’s headline inflation rate in June 2022 was at 6.1 percent — a three-year high since November 2018’s 6.1 percent and October 2018’s 6.9 percent.


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