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NZ Farmers Not Responsible For Bread Price Rises

7 October 1999



Quality Bakers' recently announced five cents per loaf of bread price increase can not be attributed to farmers, Federated Farmers Grains Council of New Zealand said today.

Chairman of the Grains Council, Neil Barton, said the rise must not be blamed on wheat prices. "The Grains Council regrets that one baker has raised the price of bread to the consumer, but points out that wheat prices have dropped substantially."

Prices paid to New Zealand farmers for milling wheat have dropped from an indicative price (100 points wheat, after commission and freight) of $285 per tonne in the 1997/98 season to $262 per tonne in the 1998/99 season - a drop of $23 per tonne. This lower price follows an even greater drop in the prices paid to farmers for milling wheat for the previous 1996/97 year.

"The New Zealand wheatgrower has risen to the challenge of growing more wheat for the domestic market, despite lowered prices. Most milling wheat now in the ground has been contracted at a price determined last autumn," said Mr Barton.

"New Zealand wheatgrowers are offering to millers and bakers a variety of high quality milling wheat at prices that are more than competitive with the cost of imported wheat."

"Furthermore, New Zealand wheat growers offer millers, bakers, and particularly the consumer of wheat-based foods, a quality assurance guarantee where a trace back scheme is in place to remedy any quality problem. This is more than can be offered by any imported milling wheat."

"Wheat growers have absorbed the increased costs of world fuel price rises. On-farm costs, transport costs, plus the secondary range of costs of fertilisers and agrichemicals are costs the farmer is not able to pass on," concluded Mr Barton.


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