Bread market in turmoil in Iran; Subsidized bread distribution begins with bank cards

Despite denials from officials, the price of bread in Iran has increased sharply, and a trial distribution of subsidized bread has begun in Zanjan. In Zanjan province, subsidized bread is being sold with bank cards, and there is also talk of using national ID cards.

The sharp increase in the price of bread has become one of the most important concerns of Iranian people these days, although some officials, including Ehsan Khandozi, the Minister of Economy, have promised that the price of traditional bread will not increase until the end of this year.

While chaos and confusion continue in Iran's bread market, the distribution of subsidized bread in Zanjan province has begun on a trial basis and through bank cards.

ISNA news agency reported on Friday, May 6, quoting the Director General of Public Relations of the Zanjan Governorate: "Given the large volume of violations in the field of flour distribution, it has been decided that the bread subsidy that was previously allocated to wheat will be paid directly to bakers."

According to this report, Mehdi Vargaei said that with the start of this program, Zanjan bakeries will be connected to smart card readers so that the bakery will be given a bread subsidy based on the number of loaves sold.

A return to the era of coupon goods with a new twist

With the sharp increase in prices, the discussion of returning to the coupon distribution of subsidized goods that was implemented during the Iran-Iraq war has once again risen and has been put on the agenda more seriously in the Ebrahim Raisi government.

Meanwhile, there has been talk about distributing subsidized bread based on citizens' national ID cards, but the exact amount and purpose are not clear.

Ibrahim Sayami, a director of the Ministry of Economy, claimed on Wednesday that the government's plan will not increase the price of bread for the people and that citizens will be allocated a "bread subsidy" for each national ID. He also said that it would be possible to purchase subsidized bread with a bank card.

Mohammad Reza Mirtaj al-Dini, deputy chairman of the 11th Parliament's Program and Budget Commission, described the government's plan to distribute "digital coupons, or the former coupons," about a month ago.

"Consumption pattern" of bread with a baguette worth ten thousand tomans?

According to the Asia newspaper, Siyami said about the government's plan: "The advantage of this is that people who consume more than the standard must correct their consumption pattern or buy at a free price. People whose consumption is less than the standard pattern will also have money left over."

In recent days, news has been published online that the price of industrial bread has suddenly doubled, and the price of each baguette has reached ten thousand tomans.

Some officials have denied the sharp increase in the price of non-traditional bread, but evidence and comments from users on social media confirm that one of the main reasons is the more than ninefold increase in the price of flour for industrial bread production units.

Mohammad Javad Karami, head of the May 11 Fancy Breads Union, told the "Khabar Online" website that according to the Market Regulation Headquarters' resolution, the price of flour for these units has increased more than ninefold from 1,750 tomans per kilogram to 16,000 tomans per kilogram.

More than tripling the price of Sangak bread?

He denied the price list published on social media for fancy breads, but said that due to the elimination of flour subsidies and other costs, the price of these products will henceforth be determined by "supply and demand" and competition between production units, and there will be no approved price.

Despite repeated claims by government officials that the price of traditional bread for consumers has not increased, price lists on online stores indicate that the price of Sangak bread has more than tripled. Some internet users are also reporting buying bread at the new prices.

The increase in the guaranteed purchase price of wheat from farmers, the elimination of the state currency (4,200 tomans per dollar), and the food shortage crisis caused by Russia's military aggression against Ukraine are considered to be the most important reasons for the increase in the price of bread.

According to Khabar Online, the Minister of Economy, referring to the consequences of this war, said: "With the war in Ukraine, the situation of trade in basic goods also became complicated, and the prices of wheat and oil increased sharply, causing the prices of basic goods in Iran to decrease to one-tenth of the prices in neighboring countries, which led to smuggling abroad."

Mir Kazemi, head of the Budget Planning Organization, recently claimed that the government will not eliminate bread subsidies, but will "redistribute them optimally" and prevent flour smuggling by adjusting the price of flour.

Despite these statements, confusion continues in the chaotic bread market, and concerns about the sharp increase in the price of bread, which is the staple food for a large portion of citizens, continue to grow.

Source: DW