Supply and Internal Trade Minister Ali Moselhi decided on Tuesday to deduct the ministry's arrears of bakeries from the upfront money they pay to purchase flour.

Moselhi said if the ministry's arrears for bakeries exceed the flour upfront fees, bakeries should send a letter to the General Authority For Supply Commodities (GASC).

Under the new system, bakeries buy flour at market prices in advance and after producing and selling their bread to ration-card holders, they will be compensated for the shortfall in production costs.

Subsidy card holders can currently buy loaves for EGP 0.05 each, ten times less than the real cost of production, using an electronic smart card that gives a maximum of five loaves of bread a day to card holders.

The real production cost of bread is currently estimated between EGP 0.55 and 0.6 per loaf, according to government figures.

Each bakery owner decides the amount of flour he wants to buy.

Source : Mena