Iran has been grappling with a bread crisis, and the regime’s efforts to stabilize bread prices have faced significant challenges. Despite a plan to subsidize 40% of daily bakery sales, inflation has persisted, impacting the costs of various food items. Consequently, bread consumption has surged as it remains a more affordable staple for Iranian households compared to other commodities.
The Statistical Center of Iran reported that in 2022, each household in Iran consumed an average of 161 kilograms of bread annually. This consumption level had been slightly lower, around 150 kilograms, a decade earlier in 2011. The cost of bread has undergone considerable fluctuations over the years, escalating from an estimated 500,000 tomans per family in 2015 to a staggering 2.2 million tomans by 2022.
The burden of food inflation disproportionately affects lower-income segments of society, particularly those in the first to third deciles. For them, bread constitutes a significant portion of their diet compared to higher-income groups. Recent data from the Statistical Center of Iran revealed that bread comprises 29% of the food consumed by the bottom three deciles, while meat accounts for only 16%.
Iranians’ heavy reliance on bread for sustenance has become evident in various studies, with consumption levels two to three times higher than in other countries. This trend serves as a warning to officials that any increase in bread prices could lead to hunger among vulnerable segments of the population.
In response to these challenges, the regime allocated a substantial budget of 104 trillion tomans for bread subsidies in the 2022 budget, intended to support wheat farmers and bakeries. A bread smart card system was also introduced in some provinces to manage flour consumption and provide subsidies to bakers. Economic experts strongly advise against raising the price of bread to avert a severe humanitarian crisis.
Despite ongoing debates on bread subsidies, the regime has refrained from removing them due to concerns about their social consequences. Masoud Daneshmand, an economic activist and former Secretary General of Iran’s Economy House, stressed that bread is a critical source of sustenance for many people and emphasized the need for a well-planned and suitable alternative before considering removing subsidies.
Instead, the regime opted to implement the bread smart card system, equipping most bakeries in the country with special card readers. Though this approach aimed to monitor flour consumption and sales, it was met with opposition from bakers who claimed their recorded sales were lower than actual figures.
While the bread price problem has seen some resolution, concerns persist over the quality and quantity of government-provided bread. State-owned and independent bakeries coexist in the city, and citizens have voiced dissatisfaction with the government’s bread.
Despite some level of satisfaction among bakers, and the public, discontent remains among wheat farmers who continue to be unhappy with the regime’s payment practices.
Iran’s bread crisis remains a complex issue that requires careful consideration of economic policies, subsidy management, and the welfare of its citizens.
The price of bread in Mashhad has seen a steep 40% increase recently. Previously, households could purchase subsidized traditional Barbari bread at 850 tomans, but now it reaches 1,200 tomans. Similarly, the subsidy for traditional Tafton has risen from 650 to 900 tomans, Sangak from 1,400 to 2,000 tomans, and Khorasani Barbari receives a partial subsidy, with prices ranging from 1,300 to 1,800 tomans. This information was reported by the Fars News Agency on July 25.
The situation has been a cause for concern for quite some time. Back in May, Sangak bread reached exorbitant prices, going up to 7,000 tomans per piece, and online sales of Sangak bread even reached a staggering 35,000 tomans.
On May 3, 2023, the state-run outlet ‘Tjarat News’ ran a headline about the bread situation:
“Bread Sold at 35,000 Tomans!”
According to the report, the online sale of bread has reached new heights of inflation, with simple Sangak bread being sold for 15,000 tomans and ‘multi-grain’ Sangak bread (with bran, sesame, black seeds, and dried vegetables) fetching a hefty 35,000 tomans per piece! Barbari bread is also available to customers at prices ranging from 14,000 to 30,000 tomans.