Sri Lanka to feel the pinch of tension in Red Sea

8 January 2024 08:09 am Views - 2405

Colombo, Jan 8 (Daily Mirror) - Sri Lanka is likely to feel the pinch of the impact of Houthi rebel attacks in the Red Sea since the price of wheat flour shipments originating from Turkey have increased by more than US $ 100 a tonne, according to local importers.

Shipping companies have diverted away from the Red Sea as a result of attacks by the Houthi group.

A spokesman for the Essential Commodities Importers and Traders Association told Daily Mirror yesterday that Sri Lanka imports 25 percent of its total wheat flour requirement while the rest is supplied by two companies that import wheat grain to be milled locally.

The spokesman said Turkey was the key supplier and the price which remained around US $ 350- 360 a tonne had now increased to US $ 450-460 a tonne.

“Now shipping companies take a longer journey . Shipping duration will increase by one month at least . Also freight charges have increased due to high insurance premium triggered by the tense situation in the Red Sea,” he said.

Against the backdrop, importers are planning to request Trade Minister Nalin Fernando to waive off custom duty and other taxes to keep the retail prices stable. Currently all taxes imposed on a kilo of imported wheat flour amount to Rs. 44.

The spokesman said ,”the delivery of shipments ordered at the previous rates will be completed by February 1. We will have the price issue for shipments afterwards,”

Besides, freight charges on dhal imported from Austrailia have also increased due to high marine insurance premium under the current circumstances.