Tashkent, Uzbekistan (UzDaily.com) — From 2020 to May 2025, cumulative inflation on first-grade wheat flour bread in Uzbekistan reached 77.6%, according to an analytical study by the Central Bank examining factors affecting bread pricing.

The Central Bank reports that during this period, bread made from highest-grade flour rose by 52.5%, while obinon bread increased by 62.4%. The cost of flour itself also saw significant growth: first-grade flour rose 56.9%, and highest-grade flour by 73.5%.

Analysis of the global market indicates that wheat prices are expected to remain stable in the coming years. In April 2020, one ton of wheat cost USD 179.7, peaking at USD 406 in April 2022 amid the pandemic and the Russia–Ukraine conflict. By April 2025, the price fell to USD 174.8 per ton, the lowest level in five years.

The International Grains Council (IGC) forecasts wheat production for the 2025–2026 season at 806.4 million tons, 1% higher than the previous season.

The study also identified a relationship between bread consumption and income levels. In low- and middle-income countries, a 1% increase in real income reduces bread consumption by approximately 0.2–0.3%. For example, research in Poland shows that the lowest 20% of the population consumes an average of 4.2 kg of bread per person per month, compared to 3.9 kg for the wealthiest 20%.

At the same time, Uzbekistan’s population growth of 2% per year creates additional demand: every one million new residents increases annual bread demand by roughly 171,000 tons.

On the supply side, the Central Bank highlights energy costs, utilities, and transportation expenses as key factors in price growth. Cumulative inflation over the period reached 99.3% for gasoline and 113.4% for propane; cold water and sewer tariffs rose 294.9%, network gas increased 129%, and transport maintenance and repairs rose 115%.

High inflation complicates the provision of capital and working funds for the baking industry, the report notes.

Uzbekistan remains critically dependent on wheat imports, with 99% of supplies coming from Kazakhstan. In 2024, imports totaled 3.6 million tons, up from 2.6 million tons in 2020. Correlation analysis shows a strong link between global and domestic wheat prices (correlation coefficient 0.94), making the local market highly sensitive to international price fluctuations.

Environmental factors also significantly affect production. Soil salinization increased from 450,000 hectares in 2000 to 750,000 hectares in 2020, reducing yields and farmer incomes. High temperatures, water scarcity, and inefficient irrigation systems further constrain production.

Fertilizer use in Uzbekistan is extremely high — 450–480 kg of nitrogen fertilizers per hectare, far above the global average. The Central Bank emphasizes the need for a comprehensive approach, including water management, optimization of agricultural technologies, and the use of resilient wheat varieties.

Recommendations include strict adherence to wheat sales through exchange trading, improving internal resource efficiency, diversifying import sources, developing irrigation and agronomic technologies, and strengthening price stabilization mechanisms.

“Despite stabilization in global prices, it is necessary to increase local production and enhance research efforts in this area,” the report concludes.