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Apr 15, 2008

Price controls on flour are nonexistent

Story PictureOn yesterday’s newscast we reported a late afternoon government press release announcing a drastic forty-two percent rise in the price of flour. The release was not particularly clear and did not explain the implications of the increases for consumers. Today, the situation remains confused as consumers stock up on existing supplies and prepare for even higher prices ahead. News Five’s Kendra Griffith has the story.

Kendra Griffith, Reporting
Flour was a hot commodity today as consumers sought out business which had not yet implemented the government approved price hike.

Ranju Vanjani, Manager, Public’s Supermarket
“We selling only by pounds, we are not selling by sack because people want to buy by sack, but we have to provide to everybody till tomorrow and Friday we will be going up.”

Kendra Griffith, Reporting
“So how much is the maximum that people can buy?”

Ranju Vanjani
“Up to five pound, ten pound, I can’t give them more than ten pound right now because we don’t have a lot left right now.”

But while Public’s Supermarket and the bigger stores were still selling at seventy or seventy-five cents per pound, most of the smaller shops had already increased their prices.

Kendra Griffith
“How much unu di sell it ah pound?”

Wendy’s Clerk
“Eighty-five cents a pound.”

That price is a cent above the government mandated eighty-four … and even the low-ball seventy cents, is six cents more than what G.O.B. says existing stocks of flour should be selling at. According to some of the vendors, those controlled prices just don’t cut it.

Tony Eck, Tony’s Store
“Definitely the price going up about ninety, ninety-five cent a pound or something like that.”

Kendra Griffith
“Even though government is saying that they noh want you di sell it fi anything more than eighty-four cents because it is a controlled price?”

Tony Eck
“The government would say something of the sort but they got that only just fu cushion the people inna that sense but the real thing dah noh soh inna that. Dah not the real thing.”

Kendra Griffith
“It’s not practical for you?”

Tony Eck
“Definitely it wouldn’t be practical for that.”

Raju Vanjani
“How I going to sell for eighty-four cents? We have to be making something because we have to make a margin, twelve to fifteen percent and we are going to sell it for eighty-four cents? It can’t be possible. Up to ninety-five cents, I can understand that.”

Kendra Griffith
“And how much will your price increase by?”

Ranju Vanjani
“Well I am going to get it for eighty-two dollars or eighty-one dollars and we are going to sell it for ninety-three cents to ninety-five cents for the pound.”

When we contacted Yvonne Hyde, C.E.O. in the Ministry of Economic Development, she informed us that she could not comment as yet, but said that a consumer protection paper was placed before Cabinet today which speaks to the matter.

And while some consumers are already bawling about price hikes in just about everything… a deal between ADM Belize Mills, government and the Bakers Association to sell the producers the Bebe Agua flour at previous price of about sixty-two dollars will prevent the hike from reflecting in the cost of a loaf of regular sliced and un-sliced bread.

Andre Perez, President, Baker’s Association
“It is directly aimed to those that are producing the slice bread, sixteen ounce, which is the only thing that is price controlled. So that’s another key thing. So if you have a small baker man who is not making the slice bread and just doing the regular breads and everything that does not have any price control, I don’t think they will be able to get that price that we are getting at this point in time.”

The bakers, however, were not exempt from the increases in the La Gitana, Purity or HI-Rise, which all rose by twenty-four dollars. According to President of the Baker’s Association, Andre Perez, they are also holding off on passing that cost to consumers.

Andre Perez
“We use the other La Gitana as well as the Purity flour, and the Whole wheat to make other products that do not have the price control. What we could have done last week with the increasing of prices we could have done an increase price on all the breads that we will sell. We’re talking about the buns, the hot dog buns, the burger breads, sweet breads and everything that we make. We agreed that we would maintain that price on just about everything until the price changes that they say we are no longer having that price that we’re having with the Bebe Agua as well. We’ll have to move and unfortunately increase prices on products.”

Kendra Griffith
“How big of an increase would you all need in order to be sustainable?”

Andre Perez
“Kendra, that is also an issue that we are looking at closely, obviously, but I can tell you that it won’t be nothing less than a quarter, nothing less … if not more.”

That increase is expected to come on stream when the next shipment of wheat arrives in about six to seven weeks.

Andre Perez
“Tentatively, we have a meeting set for the seventh of May where we will sit down and look for the prices as well. And the part of the government that they are deciding is that they promised us to look at the price control regime on the slice bread, to totally look at removing it. The reason being to remove is that it allows us a little bit more leverage to move in raising prices but in a uniform manner. And if you have healthy competition amongst one another, I can guarantee that the prices of bread will not be going up tremendously as compared to other places that is occurring in the Caribbean. We are not endorsing the price increase, absolutely not, but we understand that there is nothing we can do. That’s the point we need to make clear, that this is something beyond our control.”

Perez says they are hoping consumers won’t hold the increase against them.

Andre Perez
“We do have concerns that our sales could be affected because people are already struggling with food prices going up. That is our concern that we need to look at that our sales don’t go down as well. It’s not something that we’re all so happy that the prices increase because we want to increase our profit margin.”

Kendra Griffith reporting for News Five.

The last time flour was increased was just before Christmas when the price rose by ten cents per pound.

Viewers please note: This Internet newscast is a verbatim transcript of our evening television newscast. Where speakers use Kriol, we attempt to faithfully reproduce the quotes using a standard spelling system.

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