THE appeal by sugar millers last month to raise the retail price of white sugar by a whooping RM1 has been met with disbelief by consumers, particularly those in the kopitiam business who are still grappling with the rising cost of living.

Though the government has yet to make a decision on the request, the president of the Federation of Sundry Goods Merchants Association of Malaysia (FSGMAM), Hong Chee Meng, is asking the question, “How did the millers reach that RM1 figure?”

The current ceiling price of sugar is RM2.85 per kg.

The price increase was proposed by Malaysian Sugar Mills (MSM) chief executive officer Syed Feizal Syed Mohammad who said the increase was to meet the high cost of raw sugar production.

He said the retail price of sugar in Malaysia is the cheapest in the world, even cheaper than in Brazil and Thailand, the world’s two largest sugar producers.

“Their retail price is higher than ours,” he said.

Hong told The Malaysian Insight the proposal to increase it by RM1 was to see how consumers reacted to such a sharp hike.

“They can see that it’s very high. To hike it up by RM1 is an extremely big thing for those who use sugar heavily in their businesses.”

Hong said the request is a far cry from the last increase which was only 20 sen.

“To go up by RM1? How are we (FSGMAM members) going to do business?”

Hong said if the hike is a valid request, then it should be gradual, in small increments.

“Not a sharp hike,” Hong said, suggesting an increase of less than 50 sen.

He also pointed out that the price of raw sugar fluctuates in the international market and there will be times when the price drops when there is a bumper crop.

Hong said if the millers feel the 50 sen increase will not help them, then the government should provide some form of subsidy.

The head of the complaints unit of the Federation of Selangor and Kuala Lumpur Hawkers Associations, Boon Kok Choon, warned an increase could trigger a chain reaction.

Boon said the price of food and drinks that require sugar will definitely be increased if the government greenlights MSM’s request.

He said the association understands the quandary its members face if there is a sharp increase in sugar price.

Boon said the association would also understand if members started increasing the price of food and drinks but added any increase should be done moderately.

“We are suggesting that members inform their customers well in advance of any price increase in their food or drinks by posting a notice in their respective stores at least two weeks before their price increase comes into effect.”

Johor Baru Coffee and Wine Merchants Association chairman, Wee Liang Fatt, bluntly said any increase in sugar price will be a burden to consumers.

Wee said it will just trigger a chain reaction in the supply chain.

“White sugar, like cooking oil, is a basic necessity. Any increment will trigger a reaction.”

He said any sharp increase will be met with a very strong reaction.

“The proposed increase is too high. The economy of Johor has yet to recover.

“So the price hike, if it is approved, will have a large impact on Johor.”

Wee said it could drive Singaporean tourists away as Johor loses its competitiveness.

Businessman Wee Liang Fatt said the hike in food prices would not be the same throughout the country.

He said it will differ from place to place, depending on their location and operating costs.

MSM had highlighted the performance of Damas Sugar Mills, which reported net losses for four consecutive quarters due to high raw material costs, selling price constraints and poor production efficiency, as a reason why millers are pushing for the hike.

MSM is hoping the government can make a decision within one to two months to assist the company in turning its losses into profits.

However, there are also reports that in view of the great impact of the price of sugar, it is believed that the government will make adjustments only after the state elections in June or July. – May 4, 2023.