Bakeries: Costs Up, Consumption Down

In recent months, it is estimated that the cost of raw materials for bread production in the Nicaraguan market has increased by about 25% and consumption has decreased by 40%, a phenomenon that is reported in the context of the economic crisis generated by the outbreak of covid-19.

Thursday, February 4, 2021

Raw materials such as oils, shortening, margarine and sugar have increased their prices in this context of sanitary emergency, a situation that has put pressure on the production costs of bread producers.

Consumption has also been affected in recent months, as it is estimated that demand has been reduced by up to 40%, when compared to the sales levels reported prior to the beginning of the pandemic.

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Juan Pablo Estrada, president of the Nicaraguan Chamber of Bread, told that Nicaragua is one of the countries in "... Central America that consumes the least bread. At the best time Nicaraguans consume 19 kilos per capita per year, while other countries consume 80, 90 and 100 kilograms per year."

According to Estrada, in the Nicaraguan market industrial bread is 30% more expensive than artisan bread, this difference is largely explained by the fact that companies such as Bimbo pay taxes when marketing imported products, a situation that is different for local producers, who have been exempted from the charges.

An estimated 6,000 bakeries operate nationwide, 80% of which are family businesses. It is estimated that one out of every six bakeries is located in the country's capital.

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