SG Complains

Why your chicken rice just got pricier

According to AsiaOne

WHAT do the price of corn in Malaysia and oil in America have to do with your chicken rice?

Or for that matter, your shrinking bowl of meepok at the food court?

More than you realise.

It is not merely due to the fact that chickens have become more expensive. Or how the price of wheat affects the price of noodles.

It’s a whole host of other factors that add up to such price-rise fears that at least one MP will raise the issue in Parliament today.

Sure, ERP is up. So are petrol prices. But when it hits the stomach in a country of foodies, it’s like a blow to the gut.

Take that plate of chicken rice: What used to cost $1 at Mr Tam Hwa Joon’s chicken rice stall in Tampines now costs $1.20.

Mr Tam said the cost of buying poultry from his wholesaler increased from $3.50 to $4.10 for 1kg.

CHICKEN FEED

The price of corn, the main ingredient in chicken feed, has gone from $420 to $820 a tonne, triggering a 20 per cent hike in the price of fresh chicken, said Poultry Merchants’ Association secretary Chew Kian Huat.

He added that corn prices worldwide are at a high because of increasing demand for grain from the biofuel industry.

News reports also attributed high corn prices to rising demand from developing countries, rising populations around the world, and a shortage in supply due to frequent floods and droughts.

As for oil, the cause is a combination of political instability in the Middle East, the surge in global oil consumption and worries about tight global energy supplies.

Oil prices, which hit a high of US$96 ($139) this month, are also adding to the costs of importing and transporting chicken.

Now that bowl of noodles: The Singapore Noodles Manufacturers Association recommended raising prices by 20 to 30 per cent earlier this month.

Why? Flour, which is used to make noodles, has gone up from $15 to $22.50 per 25kg.

The price rises will be the subject of some debate in Parliament today.

Madam Halimah Yacob, MP for Jurong GRC, who heads the Government Parliamentary Committee for Health, will be asking the Minister for Trade and Industry whether the Ministry is monitoring the increase in prices of food items, such as flour and chicken, and how these price increases and the impact of rising inflation will affect consumers.

Non-Constituency MP Sylvia Lim, chairman of the Workers’ Party, intends to ask if the increase in the cost of living is a cause for concern, and whether the GST hike of two percentage points, implemented in July, contributed to the higher costs.

Prime Minister Lee Hsien Loong said yesterday that the Government is helping Singaporeans cope. This meant ensuring ‘that the low income are able to pay for their necessities, able to earn a living, able to have a house over their heads’.

INFLATION

Is there a reprieve in sight? At least one economist, Citigroup’s Chua Hak Bin, has projected that inflation will hit 4 per cent in the first half of next year.

It now stands at 2 to 3 per cent. If he’s right, the Chinese New Year celebrations could be costlier.

Already, poultry mechants are talking about price rises well into next year.

Justifying the increase in the price of fresh chicken, the Poultry Merchant’s Association’s Mr Chew said: ‘For 30 years, the price of chicken has not increased much, compared with prices of beef, pork and mutton.’

He warned that chicken prices may increase even more, especially towards the Chinese New Year period.

But there are some, like Mr Darren Toh, who will try to buck the trend by finding new ways to cut costs.

Mr Toh, whose company processes chicken, is now buying chicken for $3.30 a kg compared with $3 a kg previously. He buys his fresh chicken from an importer, Lee Say Poultry, which brings the chicken in from Malaysia.

He will try to cut on transport costs by encouraging his retail customers to collect the chicken themselves.

But that would raise another question: Will the retailer then justify charging more by blaming petrol, transport, ERP charges, parking and a whole host of other costs increases?