FLOUR-BASED food manufacturers are bracing for an acute shortage of the ingredient as the Russia-Ukraine war rages and India’s ban on wheat exports kicks in.

They said the implementation of the minimum wage of RM1,500 and price hikes of other items will leave them with little choice but to raise prices of their products.

Johor Bakery, Biscuit, Confectionery and Noodles Merchants Association president Chink Poh Cheng said the price of flour went up in March from RM47 to RM52 for a 25kg bag. It increased again in April to RM57.50.

“There was a 20% increase twice in less than two months, and some flour mills have notified about shortages of wheat, making the whole situation not good for food production,” he said.

Chink said association members rely on flour to produce bread, noodles, fruit bars and snacks, leaving them with no choice but to adjust their prices with the next wave of price increases.

He said the prices of their products may go up by 10%.

“We will give the merchants a month’s notice before revising the prices,” he said.

A food wholesaler who did not want to be named said he is still unsure of the increase in the price of flour but claimed that word from the manufacturers is that there will be a shortage of flour next month.

“If the price of flour rises, many food products will see an increase in price as many manufacturers can no longer bear the cost hike,” the wholesaler said.

Malaysia Bakery, Biscuit, Confectionery, Mee and Kuay Teow Merchants’ Association president Lai Yee Kein said the price of flour rose by 7% in March and again to 11%, and claimed that some flour mills have informed of an impending increase of 3.5% this month.

He expressed his concern, saying at least 20% of food producers will be affected if there is a shortage of flour.

“Our food manufacturers are helpless. Factories can’t hire employees as they have to pay the minimum wage. If we don’t rely on manpower, we must invest in automated production. It’s really difficult to do business now,” he said.

Dim sum prices set to increase

Justin Hor Chee Keong, deputy president of Malaysia Selangor and Federal Territory Ku Su Shin Choong Hung Restaurant Association, said its members will raise prices starting next month, by some 25%.

He said the price of flour rose in February and March from RM33 to RM65.

“The prices of flour, chicken and cooking oil are going up every month, and our restaurants can’t adjust their menu prices every time,” he said.

“The prices of dim sum in the teahouse have increased by 15% and they may go up again by 25%.

“We adjust the menu prices twice a year at most, and the increase differs from one restaurant to another, and the guild cannot control it.

“Restaurants are short of workers and they have to raise salaries to hire people.

“Consumers today spend less on meals at restaurants compared to before.

“It is not just about making a profit; it has become a challenge even to maintain our operations.”

With the rising costs of raw food items, Hor said prices of meals will also go up.

“But if the prices are set high, customers may not return, which is also a dilemma for this industry,” he said. – June 1, 2022.