Inflation: Prices of cakes and cakes increase in the face of the rise in the price of sugar in the family basket

The inflation that our country is currently going through continues to be of concern. Faced with the rise in the price of sugar, many bakery owners are severely affected, as this could lead to the end of their businesses.

Faced with this situation, many owners of the various bakeries that exist in our country have been forced to increase the prices of these desserts. However, the acceptance has not been very good, as diners prefer, just not to buy them.

“The cheapest cake cost 25 soles and now costs thirty. This is how all the cakes have risen,” commented the administrator of a bakery in the district of Breña,” said a pastry worker for RPP Noticias.

As the economist Yefferson Llonto explained, the rise in the price of sugar would be directly related to the increase in the cost of fertilizers resulting from the war between Russia and Ukraine.

“Prices for fertilizers such as urea, ammonia and others have almost doubled. That is, due to the restrictions of China, Russia that are holding back the export of these fertilizers due to this conflict, will generate a rise in the price of products such as rice and sugar. And the harvest will fall, the supply, because it is no longer the same yield, the producer does not have the same purchasing power to buy these organic inputs,” he told RPP.

Likewise, the specialist said that the country is experiencing inflation of 6 per cent that has worsened with the high price of fuels. Given this, he mentioned that prices will rise until the end of 2022 affecting the basic family basket, which directly hits those with the lowest income in the country.

BAKERIES COULD CLOSE THEIR BUSINESSES

The increase in prices such as sugar, flour, butter and others, is causing a serious crisis in businessmen bakers and confectioners.

“Before, 60 cakes were sold a day, but now they sell 50, this is due to the increase in prices of basic inputs,” José Díaz Rubio, vice president of the Peruvian Association of Bakery and Pastry Entrepreneurs (ASPAN) told Panamericana TV.

“The national and international situation has affected us and, therefore, has forced us to raise prices. Part of this problem is the speculation of some of the wholesalers who give different prices,” said Vice President ASPAN.

“We are not going to resist all these changes brought about by the international and national situation. We have had to lay off many workers, we are practically like in the 80s with devaluation, gasoline, there is a lot of uncertainty,” added Diaz.

According to the vice president of ASPAN, there is currently no certainty that the bakery, pastry and chocolate business will generate an increase, due to the fact that many of the inputs are brought from abroad and, for example, on imported sugar a 17% tariff is added, which does not allow it to enter and compete with the national sugar.

“We are currently sacrificing the profit margin we had before, but this is not going to resist, at some point we must find an alternative to get out of the crisis. An alternative could be to reduce the size of products so as not to raise prices, or for the government to reduce the tariff on some foreign products such as sugar,” said José Díaz.

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