T&T could be facing food shortages and higher food prices over the next few months.
Flour, vegetable oil, peas and some types of meats are some of the products that the country could face possible shortages of.
Members of the business community who spoke to the Guardian Media attributed these likely shortages and higher prices to the conflict in Ukraine and other factors like a lack of access to foreign exchange.
A media release from the Food and Agriculture Organization of the United Nations in T&T on Friday warned T&T and countries worldwide to brace for higher food prices.
“The global food import bill is on course to hit a new record of US$1.8 trillion this year, but higher prices and transport costs rather than volumes account for the bulk of the expected increase,” the release said.
In a newspaper ad on Thursday, Sheik Lisha Ltd based in Cunupia apologised for shortages of products such as flour, paper bags and plastic bags which they blamed on the Russian/Ukraine war.
The company manufactures paper bags, plastic bags, garbage bags, split peas powder, parched parsad flour, all-purpose and whole wheat flour.
“Delays in shipments, decrease of raw materials, shortage of foreign currency, are some of the factors affecting us. We would like to reassure you that we are doing our best to solve this issue,” the ad said.
Managing Director of Sheik Lisha, Azad Akaloo told Guardian Media that Sheik Lisha imports its flour directly from Turkey and apart from rising global prices the ongoing war between Ukraine and Russia has also been directly impacting supplies.
“You are paying money and waiting and the ship comes when it wants. That is the big thing and there is nobody you can complain to about that.”
Commenting on the likelihood of widespread shortages and on the newspaper ad, President of the Supermarket Association of T&T (SATT) Rajiv Diptee told Guardian Media that the ad clearly shows that there are logistical problems which exist in the country in terms of importing and producing food.
Apart from confirming that shortages in products like flour are a possibility, Diptee also expects food prices to rise.
He said vegetable oil, meats and cereals are items in the supermarket which could see higher prices while there could be possible shortages of flour because of the problems of wheat in international markets.
He blames global shortages and rising food prices on international factors.
“Container shipping costs were already spiralling during the height of the pandemic and pressures are being felt more acutely due to the Russian invasion of Ukraine. Also, due to the conflict, commodities such as grain, barley and sunflower oil are facing steep price increases and shortages in some instances. When we consider agricultural inputs for production, the rising cost of fertilizer and fuel present the biggest obstacles to sustainable programmes and the bloated impact on the food import bill. We’ve seen this affect the output of poultry and egg production for example.”
The age-old problem of lack of access to foreign exchange is complicated by the fact that imported goods are also being fetched at higher prices, he added.
“It creates a situation where we are spending more foreign currency not to buy more volumes but the same or lower amounts of food. It also puts an emphasis onto what we are importing at the price points we are able to because product substitution may simply be more attractive with a limited pool of foreign exchange. This will place pressures on some distributors who may have to pivot as a result.”
Diptee expects the situation to get worse before it gets better as he argues that there needs to be a change in consumer behaviour.
“We need to have an informed consumer which means working closely to educate consumers on the benefits of modifying diets. You also need to have great product alternatives that complement taste profiles and satisfaction. We are not going to see that happening in the short term in T&T so the expectation where food prices continue to increase will force a pattern where it becomes a question of price sensitivity.”
Economist Dr Vaalmikki Arjoon.
President of the Food Distributors Association Gerard Conyers told Guardian Media that the country can expect “pockets of shortages.”
“It all depends now which company gets the supply from what part of the world. It depends on the commodity too. For example, India just stopped exporting sugar. As the country does this, it would affect certain supplies to T&T. It all depends on the commodity and what you are getting from which country. So if you have traditionally been importing from India and that country is not exporting then you will have to look for sugar somewhere else. But also it does not mean that particular product will dry up completely as there are other sources in the world.”
Apart from sugar, he said anything that is a by-product of wheat such as flour could see possible shortages because both Russia and Ukraine are major producers of wheat.
CEO of Maharaj Westside Supermarket and Jumbo Foods Kumar Maharaj who is also an importer is also expecting shortages of some products based on the challenges in doing international business.
“Because of the pandemic and the situation in Ukraine, the hardest thing is to get raw materials. Even when you acquire raw materials like wheat, the next problem is to get a continuer to load it. Having gotten that container, the next problem is to get it on a ship. These problems are now starting to show their heads. The worse is yet to come. Every company which imports or brings in raw materials will experience some type of shortage, whether it is raw materials or finished products.”
Some of the shortages that consumers in T&T could experience include peas and meat products, he said.
“We are starting to have problems with peas and beans. We have no guarantee for meat over the next few months. I am one of the biggest importers of meat in this country. You can’t simply open a factory and make goat meat or beef. Countries who never bought meat are now doing so. A lot of countries who are major producers are now withholding those products.”
Given these challenges, he expects food prices to continue to rise.
“Every Monday morning I get letters from suppliers with rise is prices and they are saying it’s because of the increase cost in transportation and other factors. T&T will have to get accustomed to that. I expect this to continue to the end of 2022.”
President of the Poultry Association Robin Phillips does not expect the price of chicken to fall in the near future.
“The poultry industry faces a lot of challenges like supply chain issues. In terms of prices, they seem to be stabilised for now but they have stabilised at the high level unfortunately. We see little opportunity for the downward side of the input costs simply because of what is taking place in Ukraine and Russia. They are large-scale suppliers of grain, wheat and corn.”
Speaking in his next role as the Marketing Manager of Arawak, he said they had no other choice to raise prices earlier this year.
“At the level of the Poultry Association we don’t discuss prices but Arawak made an adjustment in prices at the end of April. It was a five per cent adjustment. It called for more than that but we felt we had to keep chicken affordable. However, right now we don’t see any need for further price adjustment.”
He remains hopeful that once the situation stabilises in Ukraine there would be a downward trend in prices.
Kumar Maharaj, CEO, Westside Supermarket
Trade Minister Paula Gopee-Scoon in a Whatsapp message told Guardian Media that there is no need to generalise and say that there are food and other product shortages as Sheik Lisha is a well-known importer and their situation does not necessarily reflect other businesses in the country.
“There are no issues of availability at this time. Sheik Lisha is known to be one of many importers and one should not generalise based on a single statement. There are known local producers of flour and no issue of availability has arisen.”
University of the West Indies (UWI) economist Dr Vaalmikki Arjoon told Guardian Media that it is not only T&T but food shortages are looming globally.
“The world is now faced with dangerous food shortages and like many other emerging economies, we are at risk of acute food insecurity. Our food import bill will certainly be higher than previous years, not because we are importing more food, but because global prices are at an all-time high, increasing by over 60 per cent from 2020 to May 2022. In this time, global prices of dairy, meat, vegetable oil, cereals and sugar increased by 40%, 28 per cent, 131 per cent, 68 per cent and 51 per cent respectively. It is now expected that due to these high prices, food imports internationally will likely total $1.81 trillion this year, exceeding an all-time high set last year by $51 billion.”
He expects this would have a negative impact on the pockets of local consumers.
“Many households are in a volatile position with strained budgets given that their spending bills have increased for fuel, medication and grocery items, leaving little wiggle room to spend on discretionary items like furniture, household appliances, apparel, etc., especially for those that already began to draw down on their savings to meet everyday expenses, as their salaries just isn’t adequate. The longer the Ukraine-Russian conflict endures will worsen this cost-of-living crisis, deepen hunger and poverty. This is more pronounced for those in the lower-income bracket, who spend up to 45 per cent of their income on food expenditure.”
He spoke about possible solutions.
“The T&T – Guyana MOU presents favourable opportunities to help lower our dependence on food imports and lower our exposure to volatile food prices, where more of our local farmers should be encouraged to invest in Guyana and acquire arable land, especially for producing crops that require large acreages such as corn, citrus, bananas, and animal farming etc. Our Ministry of Agriculture can help to facilitate this by expanding their grants and benefits to local farmers setting up operations in Guyana while partnering with Guyana’s government to provide concessions to T&T farmers in acquiring lands for farming purposes and moving of agricultural equipment across to Guyana.”
Live chickens for sale at R&N Poultry and Meat Supplies, SS Erin Road, Debe.
KRISTIAN DE SILVA
S&S Persad Supermarket based in Mayaro and Rio Claro sent Guardian Media a list of prices of basic products for the first half of 2022 and compared them to the first half of 2021. There were significant price increases in all these basic products.
Products Jan to June 2021 Jan to June 2022
Happi Brown Rice 8kg $82.95 $99.95
Ibis Flour 10kg $59.95 $69.95
RG Vegetable Oil 17L $189.95 $329.95
Nestle Klim Powder Milk 360g $24.95 $34.95
Happi Brown Sugar 1200g $17.95 $19.95
Yellow Split Peas 800g $7.95 $11.95
Swiss Macaroni $9.95 $11.95
Cheese Per Lb $24.95/lb $31.95/lb
Cook’s Mate Rolled Oats 454g $6.95 $8.95
Brunswick Tuna In Oil 142g $11.95 $12.95