Cooperatives and supermarkets say they will not be able to hold on to their prices of essential commodities for much longer.
Prices of essentials poised to spiral
By Himendra Mohan Kumar, Staff Reporter/GULF NEWS Published: August 28, 2007, 23:23
Abu Dhabi: Prices of essentials in the UAE might go up in the coming months, large retailers say.
Cooperatives and supermarkets say they will not be able to hold on to their prices of essential commodities for much longer, despite efforts by the UAE’s Ministry of Economy to curb inflation, as suppliers are threatening to pull out amid squeezed profitability and rising costs.
“The suppliers have restrictions from the ministry and they say they can’t afford to supply at the current prices. If they increase their prices, then we have no choice but to pass them on to the customers,” Abu Dhabi Cooperative Society’s purchase manager N.S. Jayan told Gulf News.
Retailers say the prices of rice, wheat, cooking oil and milk powder are under pressure as suppliers are citing increased production and transportation costs, insufficient crop and an uptrend in domestic and overseas demand as reasons for raising the prices.
Ebrahim Al Bahr, assistant general manager at Union Cooperative Society in Dubai, said they will hold on to their current prices until Ramadan.
“After that, the Ministry of Economy will sit with the suppliers and we will then get an overall picture of where the prices are headed.”
Last year, the prices of food items surged dramatically during Ramadan. It became serious enough for the Ministry of Economy to interfere and issue warnings.
The situation had resulted in the establishment of the Consumer Protection Department by the ministry.