Price of pan de sal to go down - bakers

The price of pan de sal is expected to go down in the next few days after flour millers lowered the cost of bread flour by P30 per bag.

“The price will go down, I just cannot say by how much yet,” Chito Chavez, vice president of the Philippine Federation of Bakers, said in a telephone interview.

“I can also assure the consumers that the pan de sal will be bigger,” he added. Currently pan de sal is priced between P1.50 and P2 per piece.

According to Chavez, bakers will not be able to instantly feel the lowering of bread flour prices because they have inventories of up to two weeks.

“It would take time to know by how much bread prices will go down but definitely there will be some adjustments,” Chavez explained.

“The reaction will come in the next few days. Competition between the 10,000 bakers will drive down the price,” he said.

At the same time, Chavez expressed gratitude to the flour millers for bringing down the price of flour.

“We are very grateful for the price reduction. We need this to recover because the industry is not doing very well,” he explained.

Local bread flour prices have fallen by as much as P30 per bag since August this year as flour millers compete for a bigger share of Christmas sale aided by the continued slide of wheat prices in the world market.

From P956-P970 per 25-kilo bag ex-mill in August, the price of hard flour dropped to P946-957 per bag in September.

Late last week, prices again went down to P925-940 per bag. Soft flour prices also dropped from P860-P870 in August to only P840-P850 last week.

“Ex mill” price refers to the cash price paid when the flour is picked up by the buyer from the mill. Hard flour is used for pan de sal and loaf bread while soft flour is for pastries, cookies and cakes.

In Metro Manila, flour traders usually add another P10 per bag to cover the cost of trucking and warehousing. Outside the National Capital Region, retailers add a premium to cover the higher cost of freight and storage.

Flour consumption usually surges in November and December as bakeries and food manufacturers stock up on flour due to increased demand for bread for yuletide festivities.

“While previous years saw flour prices move up during the Christmas holidays, the situation is reversed this year as wheat grains prices dropped mirroring similar falls in the stock markets worldwide,” Ric M. Pinca, executive director of Philippine Association of Flour Millers (PAFMIL). said.

“We expect flour prices to remain low throughout the holidays and discount any possibility of price spikes before the end of the year,” he added.