Bread: Concerns as distribution chains dictate costs despite lower flour prices

Bread is a staple food for many in Northern Nigeria, serving as a primary breakfast choice across diverse ethnic, linguistic, and cultural groups. With bakeries operating in nearly every state, the industry is vital to both regional and national economy.

According to Statista.com (a global data and business intelligence platform), Nigeria’s bread market is projected to generate $18.81 billion in revenue by 2025, with an annual growth rate of 11.04% (CAGR 2025-2030), revenue surged by 14.3% compared to 2023.

In recent years, the price of flour, bread’s key ingredient skyrocketed, reaching over NGN 80,000 per bag in markets across Kano and other northern states. This forced bakeries to raise prices to cover production costs. However, flour prices have since dropped significantly.

Despite this, bread prices remain stubbornly high, sparking concerns among Kano residents.

Investigating the issue, DAILY POST conducted a market survey at Singa Market, a major food distribution hub in Kano and Northern Nigeria.

Flour prices have dropped, but bread prices haven’t

In an interview, a flour distributor in Kano, Usaini Rabiu confirmed the price drop. “Since mid-2024, flour prices have fallen significantly. We now sell a bag for NGN 55,000 to NGN 56,000. There is ample supply, and all major companies are producing. We urge retailers to pass these reductions on to consumers.”

A price check in various stores within the market confirmed this claim. Following this, we visited a well-known bakery in Kano to understand why bread prices had not adjusted accordingly.

A bakery manager, speaking anonymously, insisted that their prices had already been reduced.

“A loaf that previously sold for NGN 1,300 now costs NGN 900, while the NGN 1,000 loaf is now NGN 700. We adjusted our prices as soon as flour costs dropped. However, I’m shocked to see bread being sold at inflated prices elsewhere.”

Middlemen under fire

The manager blamed middlemen for the price inconsistencies, saying “We sell a loaf to distributors for NGN 900, yet I see the same loaf selling for NGN 1,400 in retail shops. When I investigated, I found out that distributors sell to retailers for NGN 1,200, making a profit of NGN 300 per loaf—more than what we, the producers, make!”

A tea and bread vendor, Kamalu Ishaq, echoed this frustration. He lamented that despite flour prices dropping, bread prices have not followed suit.

“There has been no real price relief since flour costs spiked nearly two years ago. If we make any profit on bread, it's barely NGN 100 per loaf. A NGN 1,000 loaf is sold to us at NGN 900 by distributors. When we complain, they just tell us to be patient, even though we can clearly see that flour prices have dropped.”

The blame game continues

The consistently high retail prices suggest that middlemen and distribution chains play a significant role in keeping bread costs elevated.

However, Abubakar Garba Indabawa, a bread distributor with years of experience, refuted this claim.

“Nowadays, bakeries require full payment upfront. Unlike before, when we could take bread on credit and pay after selling, we now buy at our own risk. The profit margin is minimal -usually no more than NGN 100 per loaf. For every NGN 10,000 worth of bread, distributors make NGN 1,000 in profit. In some cases, we don’t even earn that much.”

What’s the solution?

As this blame game continues, consumers—especially low-income earners bear the brunt. It remains unclear who is truly responsible for the price discrepancy.

Amid growing frustrations, there is a rising call for regulatory measures to ensure that reductions in essential commodity prices, such as flour, translate into lower costs for bread and other bakery products.