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. Last Updated: 07/27/2016

Bread Price Hike Evokes Hardship Fears

MTA man purchasing loaves of bread at a kiosk near the Zotov Bread Factory, situated by Belorussky Station.
Like millions of the country's pensioners, Valentina Pivovorova, 70, severely felt this month's sudden increase in the price of bread -- the foodstuff that has historically buffered the country from starvation.

Pivovorova, a survivor of the World War II siege of Leningrad, said that she never let her grandchildren waste even one crumb of bread.

"Every crumb was valued the same as a human life," she said.

Along with the recent bread price rises, which varied across the country, came officials' predictions of more to come -- up to 40 percent by the year's end, according to one Moscow food official. The blanket coverage of the price hikes in the state media also prompted many to wonder if a substantial increase in the cost of living would follow, triggering shock waves across the country.

A sudden rise in grain prices, both in Russia and internationally, prompted the bread price to rise -- in Moscow by up to 5 rubles (20 cents), or one-third, on a simple wheat loaf.

During a televised government meeting earlier this month, Agriculture Minister Alexei Gordeyev said he anticipated a wheat harvest of 76 million tons this year, 2.4 million tons less than 2006.

The news sent grain buyers into a temporary panic, and pushed up bread prices for consumers.

But by Monday, Gordeyev said grain prices were falling again, as grain harvesting was in fact up on last year. Yet the price crisis appeared to scare many for whom past times of hardship still remain fresh in the memory.

"Climbing bread prices are scaring consumers to death," Russian Grain Union President Arkady Zlochevsky said in a recent telephone interview. "They are developing a fear of bread shortages, the introduction of mandatory rationing of bread or famine, but all of this is untrue."

At the height of the scare, Viktor Olkhovoi, first deputy head of the Moscow food department, warned that if the trend in grain prices continued, "a kilo of wheat bread, which sells now for 10 rubles, could sell for about 14 rubles toward the year's end."

Other officials rushed out with predictions of steep inflation in bread prices.

"Earlier, one ton of high-grade flour sold for 6,500 rubles, now it sells for 9,700 rubles [$380]," said Viktor Kostrov, a specialist with the territorial agency of food and processing industries.

Zlochevsky insisted, however, that there was no correlation between the bread price hike and the one for milling wheat and grain. Instead, he said the cost of delivery and other logistics were largely responsible for the price hike, adding that there was at least a 30 percent difference in the cost of bread from bakeries to stores.

Zlochevsky also said a 20 percent rise in the bread price was unavoidable during the summer. "The price of grain has reached its peak and we expect it to come down soon because supply will soon exceed demand, forcing prices down," Zlochevsky said.

Russia produces about 78 million tons of grain annually. Of that amount, 69 million tons are consumed inside the country and the rest is exported, Zlochevsky said.

"This year, harvests are expected to yield 77 million tons, so there's still grain left for export when you factor in the grain reserves from previous years," Zlochevsky said.

While experts differ about the cause or severity of the price rises, one thing is certain -- every ruble counts to pensioners and low-wage earners.

"The new generation is richer and therefore eats less bread," said Alexander Troshin, 79, a World War II veteran who served in the NKVD. "Only we old people and pensioners still depend so much on bread because we simply have no choice."

"Everything goes up more than pensions," he said. "Tell me, what else can I buy on my pension of 5,600 rubles ($220) after paying for my apartment and medicine?"