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Cost of living soars with price controls removed

12 Oct 2021

  • Prices of bread, rice and curry packet, cup of milk tea go up
  • Follows Govt.’s removal of price controls on LPG, milk powder, wheat flour, cement
  • CPC also seeks fuel price hike
  • Rice mill owners and companies fixing prices, not Prez or Govt.: JVP
BY Buddhika Samaraweera With the Government seemingly having abandoned its policy of price controls due to the resultant shortages, the cost of living has soared for the average citizen, with the price of bread going up by Rs. 5 and a packet of rice and curry and a cup of milk tea by Rs. 10 each. Serendib Flour Mills (Pvt.) Ltd. and the Prima companies have decided to increase the price of 1 kg of wheat flour by Rs. 10, with effect from yesterday (11). Following the companies’ decision to increase the price of wheat flour, the All Ceylon Bakery Owners’ Association (ACBOA) yesterday announced that the price of a loaf of bread would be increased by Rs. 5. Accordingly, the price of a 450 g loaf of bread has been increased by Rs. 5. Commenting on this, ACBOA President N.K. Jayawardena yesterday stated at a media briefing that the price of bread had to, with reluctance, be increased. He said that despite their request to bakery owners to increase the prices of bread and bakery products in August, not all bakery owners had increased their prices. “Today, the price of 1 kg of wheat flour has been increased by Rs. 10. The price of gas has also gone up. At present, about 25% of Sri Lankan bakery owners use gas. In addition, sugar, coconut oil, margarine, and everything else has gone up in price like never before,” he noted. Speaking further, Jayawardena said that therefore, given the aforesaid issues, it was not at all possible to provide bread at the prevailing prices. He added that even though a price increase of around Rs. 5 would not be sufficient, it was decided to increase the price by Rs. 5 since they did not want to cause inconvenience to the consumers. “However, no decision has been taken to increase the prices of other bakery products. We urge bakery owners in the country to increase the prices of other bakery products in a reasonable way so as to not embarrass consumers; but as an association, we have not set a price,” he explained. The Canteen Owners’ Association has also announced that the price of several food items and beverages would be increased with effect from today (12). Accordingly, the price of a packet of rice and curry has been increased by Rs. 10, while the price of a cup of milk tea has also been increased by Rs. 10. Furthermore, cement companies yesterday announced that the price of cement would be increased with effect from yesterday. Accordingly, the price of a 50 kg cement bag has been increased by Rs. 93, which brought its new price to Rs. 1,098. On 9 October, the revised prices of imported milk powder were announced by the Milk Powder Importers’ Association. Accordingly, the price of 1 kg of milk powder was increased by Rs. 250 to Rs. 1,195, while the price of 400 g of milk powder was increased by Rs. 100 from Rs. 380 to Rs. 480. On 10 October, Litro Gas Lanka Limited, the largest importer and supplier of LPG in Sri Lanka, announced the revised prices of its LPG cylinders. Accordingly, the price of a 12.5 kg LPG cylinder which was Rs. 1,493 was increased to Rs. 2,750 by Rs. 1,257 and the price of a 5 kg LPG cylinder was increased by Rs. 503. Accordingly, the new price of a 5 kg LPG cylinder was Rs. 1,101 and the price of a 2.5 kg LPG cylinder, which was Rs. 289 was increased to Rs. 520 by Rs. 231. However, Litro Gas Lanka had revised these prices of LPG cylinders yesterday (11) afternoon, a few hours after announcing the hike in prices. According to the revisions, the price of a 12.5 kg domestic LPG cylinder has been reduced by Rs. 75 to Rs. 2,675 while the price of a 5 kg LPG cylinder has been reduced by Rs. 30 to Rs. 1,071. In addition, the price of a 2.5 kg LPG cylinder has been reduced from Rs. 520 to Rs. 506 by Rs. 14. Meanwhile, the second leading importer and supplier of LPG in the country, Laugfs Gas PLC also increased the prices of Laugfs Gas LPG cylinders, with effect from yesterday. Accordingly, the price of a 12.5 kg domestic LPG cylinder has been increased by Rs. 984 with the new price reported as Rs. 2,840. The price of a 5 kg LPG cylinder has been increased by Rs. 393, making its new price Rs. 1,136. The Cost of Living Committee too had recently recommended the increase of the price of domestic LPG cylinders, following a request from the gas companies; however, a proposal had not been submitted to the Cabinet of Ministers in this regard. Meanwhile, the Ceylon Petroleum Corporation (CPC) has also requested the Government to increase the price of fuel considering the current situation. Speaking at a media briefing held yesterday, CPC Chairman Sumith Wijesinghe claimed that the CPC had incurred a loss of Rs. 70 billion as of 31 August 2021. “Today, the CPC incurs a loss of Rs. 14.56 per litre of petrol and the loss on diesel has increased by Rs. 31.46. What the CPC should do in this kind of a situation is to increase the fuel prices,” he said. Commenting on this, Cabinet Co-Spokesman and Energy Minister Udaya Gammanpila also said that he wishes to discuss the proposed increase in fuel prices with the Cabinet. Elsewhere, addressing a media briefing held yesterday, Janatha Vimukthi Peramuna (JVP)-led National People’s Power (NPP) Parliamentarian Vijitha Herath stated that the people are suffering unbearably against the backdrop of the present Government increasing the prices of goods by the hour. He added that there is a situation at present in which there is no ruler or government in the country and the rice mill owners and various companies are currently fixing prices. “We saw the President’s speech at the 72nd Anniversary celebrations of the Army, where he made it clear that he still remembers the promises made to the people two years ago. On the political stages, they promised fertiliser free of charge, a package of dry rations at a concessionary price, a Rs. 100 gas subsidy, and a relief package for other essential food items. However, our economy is collapsing, the rupee is depreciating, and there is a shortage of US dollars ($) now,” he noted. Herath further said that the country’s production has completely collapsed and that the farmers have become utterly helpless due to the President’s unwise decision to abruptly ban chemical fertiliser. “There are signs that the agriculture sector is in a complete crisis and there will be a massive food shortage in the near future.” He also said that the Central Bank of Sri Lanka (CBSL) has so far printed nearly Rs. 2 trillion, adding that due to this, the prices of goods in the country are increasing rapidly but the salaries received and the income of the people have not increased. “At this juncture, the price controls on gas, milk powder, flour, and cement were removed. This is not an issue related to dollars. If the issue was the dollar, there is no need to deregulate rice prices,” he claimed. Multiple attempts to contact Co-operative Services, Marketing Development, and Consumer Protection State Minister Lasantha Alagiyawanna and Co-operative Services, Marketing Development, and Consumer Protection State Ministry Secretary, K.D.S. Ruwanchandra, proved futile.


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