UAE: bread prices to rise 20 percent

Dubai / UAE. (gn) The price of bread is likely to spike by 20 percent later this month in Dubai and the Northern Emirates, reported Gulf News. An increase in the price of bread will have a large impact on the life of the many foreign workers, who are the backbone of the country´s workforce, as bread is a staple of their diet. Only last week 40,000 construction workers went on strike to protest their salary and working conditions, and a rise in bread prices will leave the workers with less money to send home to their families, who depend on the money to survive. Residents in the emirate of Fujairah have been left without bread after a number of bakeries stopped supply to grocery shops over a price dispute with the Fujairah Municipality. Many bakers from the East Coast took the drastic measure after the municipality ordered them to roll back bread prices. Recently, bakeries raised the price of a loaf of bread to Dh3 (80 cents), an increase of 17 percent.

Although flour is imported to the Gulf, the reason for the rising prices can actually be found in the Gulf´s main export – oil. With oil prices at above 90 US-Dollar a barrel, many Western countries have started to look for alternative sources of energy. One of these solutions is ethanol, a bio-fuel made from plants such as corn and sugar. So many farmers are now growing these instead of wheat that the increased competition for wheat on the world market is driving up the price.