Lebanon is bracing for an increase in the price of its staple "Arabic bread" as stocks of subsidized wheat dwindle, according to Ahmed Hoteit, president of the Mill Owners' Association.

Hoteit announced that the price of Lebanese bread could rise by LBP 5,000 to LBP 6,000 within the next month, reflecting the end of a subsidy program that has kept bread prices relatively stable.

The current stock of subsidized wheat, provided through a World Bank loan, is expected to last until mid-September. However, there have been no discussions or plans to extend the subsidy, leaving the future of bread prices uncertain.

Hoteit pointed out that even with the subsidy, the cost of processing wheat into flour was not covered, meaning that the looming price increase is inevitable.

Once the subsidized wheat runs out, the price of wheat for Lebanese bread will shift from LBP 60,000 per dollar to LBP 90,000 per dollar. This change is expected to have a direct impact on consumers, particularly in a country already grappling with severe economic challenges.

Currently, Lebanon only subsidizes wheat used for making Lebanese bread. Other types of bread, such as baguettes, toasts, and sandwich bread, are not included in the subsidy program. This has allowed Lebanese bread, a staple food item, to remain affordable for many households despite the ongoing economic crisis.

In May 2022, the World Bank provided Lebanon with an emergency loan of $150 million to secure a stable wheat supply and ensure that bread remains affordable for vulnerable populations. This loan was implemented starting in February 2023 and has played a crucial role in maintaining bread prices at a manageable level. However, as the subsidy nears its end, the country faces the prospect of higher bread prices, adding further strain to a population already dealing with widespread financial hardship.