Flour duopoly failures put 2,000 bakeries out of business

So far, 2,000 bakeries have been forced to close down due to the shortage of wheat flour, the Bakery Owners Association said.

Association president, N.K Jayewardene told the Sunday Times that out of the 7,000 bakeries, 2,000 bakeries have now closed. The two companies that import flour have not supplied enough.

“Normally US$15 million is spent for one shipment of wheat. But, the companies find it difficult to obtain dollars,’’ he said.

Mr Jayawardena said only a few bakers can afford to buy a 50 kilo bag of wheat for Rs 13,500 because of the limited supply.

“Crafty merchants who only release small amounts of flour at a time charge Rs 25,000 for 50 kilos,’’ he said.

Added to this, is the high cost of ingredients, higher electricity bills as well as the shortage of cooking gas for ovens. Mr Jayawardena said bakeries will soon call for an increase in the price of bread and pastry products.

Bakery owners are worried about continuing their operations.

A bakery owner near Wattala, Pradeep Liyanage told the Sunday

Times that he has managed to operate with the small quota of flour bought from the two importers.

He has scaled down production. “The demand for bread has dropped. That's why we can manage even though we bake very little,” he said. He is wondering about continuity.

The manager of a bakery on Galle main road, Yasarath Dissanayake told the Sunday Times there is uncertainty about continuing to operate. He has reduced the variety of products he sells.

“In a couple of days, our stocks will run out. If we do not get flour we would be forced to temporarily close the bakery, which has 150 employees,” he said.

He said the price of yeast has risen from Rs 300 to Rs 1,050. The price of butter and sugar has also increased.