Due to a shortage of eggs and the high price of ,margarine and wheat flour in the local market, the price of a kilo of cake has been increased up to Rs. 1,500 during this Christmas season, All Ceylon Bakery Owners’ Association (ACBOA) President N.K. Jayawardena disclosed
The price of an egg has increased to around Rs.70 in the market he said adding that despite the prices of eggs have gone up substantially, they cannot find eggs in the market. “A mafia has formed in the market to create an artificial shortage,”
Therefore, with the price increase, people do not visit shops to buy cakes .”Even the bakeries cannot use butter for cakes. If we use butter, the price of a kilo of cake would be more than Rs.3,000,” he said.
The government should take action to control the price of egg in the market immediately to relieve the consumers, he added.
The All Ceylon Bakery Owners Association on Tuesday (4) said that the two main wheat flour companies in Sri Lanka have reportedly increased the price of a kilogram of wheat flour by Rs. 13/-.
Chairman of the All Ceylon Bakery Owners Association N. K. Jayawardena pointed out that no decision has been reached with regard to increasing the prices of bread and related bakery products.
“A kilogram of wheat flour sold by these companies will now increase to around Rs. 285/-,” he said adding that given the shortage the black market price for a kilogram of wheat flour sold to bakery owners is Rs. 400/-.
He said that over 2,000 small-time bakeries, mainly in rural Sri Lanka, have been closed down due to the shortage of wheat flour directly impacting the loss of 4,000 jobs.
Prices of bakery products have increased due to the rising production costs, The failure of the budget to address the issues faced by the industry has paved the way for a price hike, he revealed.
“Our proposal to remove the tax on wheat flour has fallen to deaf ears,” Mr. Jayawardena said while explaining that the prices of bakery products will be increased to unbearable proportions if the cost of wheat flour keeps increasing.
He added that the proposal to revise taxes on margarine, yeast, palm oil, and butter – which are key ingredients used to produce bakery items have also not been addressed in the budget.
The ACBOA President pointed out that the Value Added Tax (VAT) and Nation Building Tax (NBT) continue to be imposed on all bakery products except for bread which is exempt from NBT. This has resulted in a higher production cost.
Accordingly, he said that steps would be taken to increase the prices of products although the exact figure of the price hike cannot be predicted at present.
