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Tuesday, 18 August 2020

Egypt’s Supply Ministry raises compensation for subsidized bread bakers

The Supply Ministry is paying bakeries a higher fee for producing subsidized bread, according to a decision seen by Al Mal. Bakeries are required to purchase the raw materials for bread, primarily subsidized flour, from millers and then receive monetary compensation from the government for the end product. Bakeries that use diesel fuel will now pay EGP 265 per 100 kg sack of flour , up from EGP 240. Bakeries that use natural gas will now pay EGP 283 per sack, up from EGP 213 previously. Each sack of flour will now also yield more loaves, after the ministry decided to reduce the weight of each loaf to 90 grams from 110. Bakeries will now produce 1,450 loaves per sack, up from 1,250 loaves previously.  The ministry recalculated the cost of production to account for gas and diesel price increases, ministry spokesperson Ahmed Kamal told Reuters. Bakeries have been complaining that it is costing them more to produce bread due to the rice prices of raw materials.

CORRECTION- August 19, 2020

An earlier version of this story incorrectly said that bakeries are required to purchase wheat and flour. The story has also been updated to correctly outline how bakeries are compensated. 

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