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Bakers, eateries won’t cut prices in response to meagre gas price drop
View(s):By Nathara Abeywickrema
Despite the reduction in the price of gas, restaurant operators say they are unlikely to pass on the benefit to customers because they are already grappling with rising prices of bakery ingredients and commodities.
All Ceylon Bakery Owners’ Association president N. K. Jayawardena assured that bakers will not reduce prices regardless of the drop in LP gas price by Litro Gas this week, because ingredient costs are rising.
Tax rates for margarine, palm oil, coconut oil, and butter are high. A kilo of margarine is taxed at Rs. 600, palm oil at Rs. 250, and butter at Rs. 2,000.
A. Nadarajan
He predicted that more bakeries would close.
Litro Gas cut the price of a domestic cylinder to Rs. 4,115 on April 1.
A. Nadarajan, accountant of the large-scale Victoria Bakery in Kompanna Veediya, said prices could be lowered by 10%, if the price of wheat flour drops.
“The bakery used to receive plenty of cake orders, including corporate orders, during the festive season, but not many orders have been received so far.”
Another bakery owner said there is no use in lowering the gas price when the price of sugar, butter, eggs, and wheat flour is still skyrocketing.
In the wake of the reduction in the price of LP gas, All-Ceylon Restaurant Owners’ Association chairman Harshana Rukshan said prices of meals and hot beverages would only be dropped if the price of gas and rice was reduced further.
Mr. Rukshan said it was absurd to reduce the price of a 12.5-kg gas cylinder by only Rs. 135 when eatery operators had to bear other costs.
He is concerned that although the control price for Keeri Samba stands at Rs. 260, some vendors charge Rs. 380. He wants the government to cap the price.
He also noted that while prices of certain vegetables have fallen because demand has dropped, the pricing is still unstable. According to him, the price fluctuates every day, and if prices remain the same until April 17, eateries will lower the cost of food items.
Asela Sampath, who heads the National Consumer Front, said that since the US dollar exchange rate has dropped, the government can lower the soaring price of vegetables, eggs, and other commodities.
Mr. Sampath said the prices of imports must be reduced.
Because pricing mechanisms are hidden, a kilogram of kolikuttu banana would increase in price from Rs. 420 to Rs. 600 in a matter of days, he said.
No reduction in prices as bakery and eatery operators have to bear other high costs. Pix by Priyanka Samaraweera
Soaring costs are also widening health inequalities, weakening food security, and diminishing the health of families.
Mr. Sampath said people will not be impressed with the modest drop in cooking gas prices.
After speaking to a cross-section of Sri Lankans, the Sunday Times learns that families continue to bear a heavy financial burden.
R. Miskin from Kompanna Veediya said that household incomes are not enough.
Mrs. R.G. Seela from Henamulla expects more price reductions because she has pawned her belongings. Mrs. Seela, who works as a domestic helper, wonders why her wages are not being increased.
Rajagiriya resident R.D. Lakshman is also feeling the cost of living pressures and said spending on essentials every month means there is not much money left for other needs.
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