Singapore food prices up 4.3% but some dips too

Jessica Lim, Straits Times 14 Feb 08;

Industry players attribute the rise in prices to spiralling raw material prices. Globally, prices of items like wheat and milk are at historic peaks. Suppliers The Straits Times spoke to said droughts in Australia, crop failures in the US, reduced milk production and higher cost of tin cans are all contributing factors.

PRICES of items commonly found in kitchen larders have generally gone up by 4.3 per cent since last April.

That is more than twice the 2 percentage point increase in the goods and services tax which kicked in last July, a survey by the Singapore Chinese Chamber of Commerce and Industry (SCCCI) has revealed.

The 4.3 per cent figure, however, belies the range of price increases - and decreases.

A 330ml can of Pokka carrot juice, for example, now costs 92 cents, up from 60 cents last April - a 53 per cent jump.

Other canned beverages like Coca-Cola and Jia Jia herbal tea now cost about 30 per cent more - or about 20 cents more per can.

The price checks were initiated by the SCCCI as part of its annual pre-Budget survey of 84 products, the prices of which were logged on April 9 last year and last month, on Jan 22.

The items, from NTUC FairPrice supermarkets, included rice, milk, condiments and snacks.

About half the items - 43 - showed price increases of under 10 per cent.

These included the canned soft drink, Sprite and Khong Guan assorted biscuits.

Another 12 items went up by between 10 and 20 per cent.Five were up by 20 to 30 per cent, while three went up by more than 30 per cent.

Industry players attribute the rise in prices to spiralling raw material prices. Globally, prices of items like wheat and milk are at historic peaks.

Suppliers The Straits Times spoke to said droughts in Australia, crop failures in the US, reduced milk production and higher cost of tin cans are all contributing factors.

A spokesman for Tai Hua Food Industries, which brings in an estimated 10,000 tonnes of sugar each year, said it is now paying about $650 to import a tonne of sugar, compared to about $450 two years ago.

Mr Thomas Pek, its managing director, said: 'We are forced to increase our prices, then manufacturers have to increase theirs too. It is a never-ending cycle. It is a bad time for us.'

Singapore Food Manufacturers' Association president Allan Tan said the costs of raw materials have risen between 30 and 100 per cent across the board.

The most drastic jump is in the cost of soya beans, which are now going for about $1,200 per tonne, up from about half the price a year ago.

'These price increases have to be passed on to consumers. The only way a company can keep prices the same is to absorb it. Still, few companies will be able to absorb such drastic increases,' he said.

Coffee beans, for instance, has gone up in price by 30 per cent over the past year, said the Foochow Coffee Restaurant and Bar Merchants Association. So, for example, customers are now paying more for the 3-in-1 packs of coffee mix.

Amid these rises, the prices of eight items have stayed unchanged. They include a Carlsberg six-pack of beer, Myojo instant noodles and Maggi chilli sauce. Another 13 items dipped in price during the same period.

The largest drop: about 15 per cent for Nissin cup noodles and a 1.5 litre bottle of F&N soda. Both cost $1.60 last April and their price is $1.35 now.