Wheat flour price hike to push prices of confectionaries up further

• Industry says can no longer absorb the shocks
• Says cost of production soaring endlessly  

By Shabiya Ali Ahlam
 Prices of confectionery items in the market will witness an increase in the coming days with manufacturers unable to absorb the shocks stemming from the economic crisis
any longer.

Lanka Confectionery Manufacturers Association (LCMA) Chairman S.M.D. Suriyakumara said that the fresh increase in prices of wheat flour is another blow to the industry. “We are not even sure how to handle this new hike. This puts the entire industry in an impossible situation. Our cost of production is​​ soaring endlessly,” Suriyakumara told Mirror Business.

As the confectionery industry has run out of options to carry out cost cutting exercises, a decision has been made to pass it on to the consumers.

The increase of the price of a kilogram of wheat flour by Rs.40 brings in an additional production cost of Rs.500 million per month for the industry. “We have been absorbing the increase in prices for as long as we can. We are unable to do it anymore. We are already performing in the red so we have no other options than to pass it on to the consumer,” stressed Suriyakumara. 

The industry stakeholders will meet by the end of this week to decide on the percentage increase in price for confectionery items.

Although 85 percent of the output of Sri Lanka’s confectionery industry is consumed locally, Suriyakumara said the hike in cost of production would make it difficult for it to be competitive in international markets. Meanwhile, the All Ceylon Bakery Owners Association too said that they are compelled to increase prices. The Association announced yesterday that the price of a loaf of bread has been increased by Rs. 30.00 and the price of other bakery items by Rs. 10.