Minister of Agriculture: Surging cost of wheat is making the price of bead rise

Bulgaria’s Minister of Agriculture, Rumen Porozhanov, has received the assurances of some of the big supermarkets in Bulgaria that the bread they sell will have no profit margin calculated in the price, but only a mark-up to cover the rejects and the costs in the supermarket itself. The idea is not to raise the price of bread significantly. Minister Porozhanov told BNT that he was considering a joint meeting of representatives of the supermarkets with Prime Minister Boyko Borissov.

According to Agriculture Minister Rumen Porozhanov, the main cause for the increase in the prices of bread is the rise in the price of wheat, which has jumped by nearly 20% - from 290 BGN per tonne at the beginning of the season to 350 BGN. However, he believes that the increase of 0.20-0.30 BGN per kg of bread is a lot. According to Porozhanov, the big supermarkets are a barometer of prices. That's why he's already met with some of them, he added.

Rumen Porozhanov, Minister of Agriculture, Food and Forestry: What I received as an assurance is that they will not calculate profit on the bread prices, but will only make an increase to cover costs for possible rejects or other costs in the chain itself. Ie. the bread price will not calculated with profit.

After holding talks with all the retail chains, Porozhanov will also seek a meting between representatives of the supermarkets with Prime Minister Boyko Borissov. Still, the minister is firmly convinced that no agreement can be signed with them because that would mean a cartel.

Regarding the request by the opposition BSP party for a lower VAT rate on bread, the minister said that in most EU countries, the VAT for most essential products is the lowest, but the decision for this should be made by the finance ministry.

Rumen Porozhanov: This is related to the stability of the revenues. In this context, the tax package does not provide for an additional rate for any product, including bread.

On the other hand, the reduction in the VAT rate, according to him, will allow the gray sector in Bulgaria to come out to light.