New Zimbabwe.com

Lobels bread shuts down Kwekwe plant over forex problems

By Staff Reporter


LOBELS Bread has reached a decision to shut down its Kwekwe plant citing crippling foreign currency shortages which have seen the prominent bread maker struggle to procure essential raw materials to keep producing the daily staple.

The bread producer early last year took over the plant from Kwekwe based bakery, Plaza in a $20 000 deal.

Plaza had closed shop in 2017 due to operational challenges.

The latest closure by Lobels has left the company’s over 100 strong workforce uncertain about its future.

Anguished workers who spoke to NewZimbabwe.com said they have been informed the plant was shutting down due to operational challenges.

“We were told that the company was going to shut down the plant,” said one of the workers.

“They told us that the reason for the closure was due to shortages of flour and foreign currency to continue with operations.”

The looming closure, according to workers, has been occasioned by government’s failure to meet promises of assisting the firm with much needed forex.

“We are not sure if this closure is temporary or permanent. But what we know is that currently, there is no production at the plant,” another worker said.

Attempts to get comments from the company were unsuccessful.

However, local businesses are in distress as foreign currency shortages remain scarce while recent price increases on goods and services have reduced most families’ capacity to spend like they used to.

To cushion themselves from the current economic crisis, bread makers have since increased prices from $1,40 to amounts to $2,60 with some selling the food product at US$0,90 for a standard loaf.

Last year, the central bank agreed to meet 80 percent of the firms’ foreign currency requirements to fund imports for wheat, which is in short supply in the country.

Previously, the central bank availed just 35 percent of the foreign currency the bakers requested.

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