Bakery prices up again after wheat flour hike: ACBOA

Thursday, 19 May 2022 00:25 - - {{hitsCtrl.values.hits}}

Two main companies increase wheat flour price by Rs. 35 per kilo just within a month
Latest is fifth hike since removal of MRP in October 2021
All Ceylon Bakery Owners’ Association says will not stipulate standard prices for items
Demand for bakery items fall sharply with price revisions
Crises shut nearly half of bakeries countrywide

By Charumini de Silva

Amidst flour companies Prima and Serendib increasing prices again by Rs. 35 per kilo yesterday, the All Ceylon Bakery Owners’ Association (ACBOA) said the members are grappling to remain in the industry.

This was the second time the wheat flour prices were revised for the year just within a month. On 18

ACBOA President Newton Jayawardena

April, the highest ever hike by a record Rs. 42 per kilo was announced, whilst the previous hike was Rs. 17.50 per kilo in November 2021.

With the latest upward price revision, a kilo of wheat flour will range between Rs. 325 to Rs. 330.

“We are unable to absorb the price fluctuations anymore. The two main flour distributors in the country had increased wheat flour prices again by Rs. 35 per kilo. In line with the wheat flour price increase, bakery items will also go up. All we know is that our industry is heading towards a collapse,” ACBOA President Newton Jayawardena told the Daily FT.

On 7 October, the Government revoked the Maximum Retail Price (MRP) of wheat flour and since then the companies have increased prices five times – creating history.

He also said the demand for savoury items, bread and cakes has dropped drastically, as the consumers can no longer afford to buy them due to increased prices.

As price fluctuations of key ingredients have now become an everyday situation, he said they have decided not to stipulate a standard price for their products anymore.

“There is some price increase everyday now affecting our businesses. Many have closed bakeries around the country due to the unavailability of Liquefied Petroleum Gas (LPG). The rising cost of vegetables, poultry, sugar, flour, cooking oil, gas and transport is unimaginable. This is a key reason for the closure of most bakeries,” he added.

Jayawardena said already around 3,000 bakeries including SMEs have been closed from the total of over 7,000 bakeries at present due to the multiple hardships they had to face in the post-pandemic situation.