Flour prices in Russia at the beginning of the year went up significantly, it was a reaction to the substantial increase in the price of grain, which occurred in early December last year, according to the Institute for Agricultural Market Studies (IKAR).
"The growth is serious: for the period from December 27, 2018 to January 11, 2019, the price, for example, of high-grade flour, rose immediately by 500RUR ($ 7.48) and reached 19,500RUR ($ 291.89) per ton, including VAT," Dmitry Rylko (IKAR, Director General) told. According to him, there is always a time lag between the increase in grain prices and the subsequent rise in price for flour. "Previously, it reached one and a half months, now, as a rule, it is limited to weeks, it depends on many factors," Rylko said, adding that the price of flour was "long held."
Answering the question to what extent the rise in price of flour will affect the price of bread, Dmitry Rylko said that this process "may affect" prices, but will not be decisive. "The wheat share in bakery products is low - no more than 20%, other factors are more influencing the prices," he said. In particular, Rylko added, we are talking about increasing the VAT. Bread and bakery products are subject to preferential VAT of 10%, but the increase in VAT in other areas that are involved in the production of these products can affect the prices, he said.
Source: mkond.ru.
