• Food commodity prices remain high despite fuel, LPG price reductions

Even as several metrics that heralded Sri Lanka’s economic crisis show signs of easing, the general public nor businesses appear to have felt the effects just yet. 

For instance, Minister of Power and Energy Kanchana Wijesekera last month announced that fuel prices would be reduced as a result of falling international oil prices and the recent International Monetary Fund (IMF) loan approval, coupled with an appreciating Sri Lankan Rupee. 

Accordingly, the price of a litre of 92 octane petrol has been reduced by Rs. 60 to become Rs. 340 while a litre of 95 octane petrol has been reduced by Rs. 135 to become Rs. 375. Meanwhile, prices of a litre of auto diesel and super diesel have been reduced by Rs. 80 and Rs. 45 respectively, while kerosene has been reduced by Rs. 10. 

Moreover, the existing fuel quota system under the QR code system was increased for the Sinhala and Tamil New Year festive season effective from early April, with the quota for three wheelers increasing from 5 litres to 8 litres and those of lorries increasing from 50 litres to 75 litres. 

No relief for the season 

Given that traders and businesses had cause to hike up prices of goods and services during the recent past owing partly to rising fuel costs that in turn led to knock-on effects in terms of increased transport and manufacturing costs, many have anticipated some relief for the season. 

However, despite the advent of New Year festivities, many families continue to feel the pinch of the rising cost of living, with the more vulnerable families in particular being unable to get back into the swing of celebrating Avurudu as usual. 

Margaret, who works as a domestic aide, is no longer celebrating Avurudu. “We’re not doing anything this year for Avurudu; we’re not even making kevum. We did make sweetmeats last year, but this year it’s just not possible. Goods are expensive, so we won’t be making anything.”

While she used to make all traditional sweetmeats such as mung kevum, kokis, and athirasa for the season, the current prices have made this impossible, she stressed. With ingredients such as treacle, sugar, and coconut oil, essentials in making Avurudu sweetmeats, having risen in price, purchasing these was no longer feasible, she noted. 

For this year’s Avurudu, she and her son will prepare some meal for themselves, she laughed, indicating that Avurudu celebrations were simply beyond their means as things stood, since not even essential goods such as vegetables had undergone an appreciable change for them. 

On the other hand, Punchi Kumari, whose husband earns a daily wage from hired labour, said that they had to celebrate some kind of Avurdu since everyone else was doing so.

“It is not like before, this year is much more difficult. However, since we have a school-going child in the house and they should have some sweetmeats when other homes are making sweetmeats, we also have to make something,” she said, sharing that she planned to make some athirasa for the New Year. However, she said she would be using sugar instead of treacle, given the unaffordability of the latter. 

Nevertheless, with vegetables in particular having reduced their prices, she felt some measure of relief, she noted. Even then, there will be no visiting of relatives this year for her.

“We used to visit relatives who lived far away for Avurudu, but we have no intention of doing so this year, since public transport costs have become difficult to bear.”

Consumer rights need stronger protection 

With most ordinary consumers facing a difficult New Year, Consumer Rights Protection Movement National Organiser and Restaurant Owners’ Association President Asela Sampath stressed that the Government should have formulated a programme to ensure that the price drop was passed on to consumers. 

“Although the price of fuel, LP Gas, vegetables, and essential commodities dropped, we lack a mechanism to ensure a concomitant drop in the prices of services derived from these goods. For instance, when fuel prices reduce, it is not only the bus fares that should drop, but also the manufacturing processes that use fuel such as vegetable and essential goods transport. Accordingly, when these prices drop, it should include the transported goods, but we don’t have mechanisms for this,” he stressed. 

Moreover, he noted that lax enforcement of uniform prices across the board was rendering consumers helpless, pointing out that around 40% of restaurants had reduced their prices, while there was no action taken against the remaining 60% of restaurants that had not reduced prices. 

“If the price of a good drops, it should be maintained at that price for at least a month so that customers can feel some relief. If prices fluctuate every day, there needs to be a mechanism to address this,” he said, urging for stronger consumer rights protection and enforcement from the Consumer Affairs Authority and the ministry. 

Traders 

Speaking to The Sunday Morning, Manning Market and Joint Economic Centre Association Treasurer Nimal Attanayake said that while prices of vegetables at economic centres had reduced significantly, this was due to the fact that over the recent past, the demand for vegetables had been less than supply, driving prices down. 

Moreover, he said transport costs had also dropped following diesel price reductions, which had provided some relief to producers. 

Further, with the drop in vegetable prices, consumers were seeing significant benefits since there was competition amongst traders for customers, he noted. 

Meanwhile, All Ceylon Bakery Owners’ Association President N.K. Jayawardena told The Sunday Morning that a price reduction of bakery goods was not within their means. “The prices of cakes have dropped, but there is no big difference in the prices of other goods,” he said. 

Commenting on the reasons, he said: “Firstly, the imported eggs are still in storage and they are saying that the eggs will be given after the New Year. There is no point in giving the eggs after the New Year. Secondly, even if LP Gas prices have dropped, we have never changed prices according to changes in gas prices, since only 20% of bakeries in Sri Lanka operate on gas, the rest use other means such as firewood, kerosene, electricity, etc. 

“Therefore, we cannot make a general reduction, so we have made a request for those who use gas to provide that relief to the public. That is all we can do. We are giving the maximum relief we can to consumers.”