Hard to reduce food prices in Malaysia
SHAH ALAM - It is hard for the prices of food in the country to go down although the prices of the basic ingredients are cheaper for the past few months.
Federation of Malaysian Consumers Associations (Fomca) deputy president Mohd Yusof Abdul Rahman said this often happened in the country due to the existence of cartels among suppliers, thus making it difficult for the costs of raw ingredients and food to go down because they have the power to determine the prices.
He said there were also traders who were greedy and refused to lower the prices because they wanted to make profit although they bought the raw ingredients at a cheaper price.
"Supposedly when the price of raw ingredients are cheaper, the prices of goods including food would go down.
“However, this situation rarely happens in our country. They are still selling food at high prices just like when the prices of ingredients went up.
"Traders should lower the prices along with the drop in the cost of raw ingredients, while importers should follow the market price.
"The government must continue to monitor and take action against the cartels because they are one of the causes of food prices continuing to rise," he told Sinar Harian.
The Food and Agriculture Organisation (FAO) of the United Nations (UN) on Friday reported that the benchmark for world food commodity prices declined significantly in July, with prices of grain and vegetable oil recording a double-digit declining percentage.
The FAO Food Price Index, which monitors food commodities in global trade, recorded an average of 140.9 points in July, down by 8.6 percent from June.
Mohd Yusof said government intervention was necessary in this situation.
"For example, the government's intervention in the recent issue on the price of cooking oil. When it asked for the price to be lowered since the market price of crude palm oil reduced, companies agreed to lower the price.
“Even then, there are still parties who ask for an extension.
"However, we cannot expect intervention from the government alone. The parties involved in export and import activities are the private sectors, so it depends on actions by private sectors to lower the prices because we practice an open market system," he said.
Malaysian Muslim Restaurant Owners Association (Presma) president Datuk Jawahar Ali Taib Khan said food operators should have no problem lowering the selling price of food starting this month.
This, he said was because the prices of some basic goods, especially those produced in the country, have dropped around 10 to 20 per cent in August.
He said among the basic goods that showed a decrease in price were meat, chicken and vegetables such as tomatoes, eggplants and cucumbers.
"This month (August) we can do it (lower the prices of some basic goods). The traders just need to cooperate,” he said.
Jawahar said the prices of imported food such as flour and margarine mostly remained high due to differences in the value of foreign currencies.
He said the price of cooking oil was also still high, even though some food items were expected to increase in price, including condensed milk which will increase over eight per cent.
"However, we advise food operators under the association not to increase the current selling price because the increase is only temporary," he said.
