Bakers are afraid that the best wheat will be exported

Éder Tamás
élelmiszeriparért felelős alelnök
Nemzeti Agrárgazdasági Kamara

Tamás Éder, food industry vice president of the National Chamber of Agriculture (NAK) told our magazine that due to bad weather conditions during the harvest wheat quality deteriorated considerably – not only in Hungary but practically all over Europe. Production costs in the baking and milling industry are rising but companies in the sector are unable to offset this by increasing flour and baked goods prices, for instance because some retail chains sign multi-year contracts with baked goods suppliers with fixed prices. Unfortunately the baking industry is fragmented and market players are unable to represent their interests collectively. This year the price of milling quality wheat keeps growing, while feed wheat prices are lowering. Many farmers don’t sell now but wait, hoping that the price of their good quality wheat will increase further or that that they will be able to sell their lower quality wheat for a bit more later. Mr Éder told us that sooner or later flour prices would become higher as a ­result of elevated milling wheat prices. The longer retail partners resist suppliers’ justifiable price increase, the bigger harm they do to the milling industry. About the government’s decision to apply a degressivity to SAPS payments above a certain sum: the vice president told that its influence on major agricultural producers can’t be seen at the moment, but it seems rather obvious that intensive crop farming enterprises’ profitability will reduce. The recent introduction of electronic road toll for trucks also had a negative influence on the sector. n