High energy costs will keep pushing up food prices: Gan Kim Yong

Singapore – Get ready for food prices to keep going up, as  energy prices go up everywhere.

The cost of food will  “rise further in the coming months”. That was the bad news on Nov 3 from  Trade and Industry Minister Gan Kim Yong.

He mapped out the factors, which include imported prices, energy costs, freight, labour, and seasonal weather changes, in his written reply to a question from PAP MP Shawn Huang Wei Zhong (Jurong GRC).

Mr Huang had asked about the impact on prices of increasing energy costs and supply chain disruptions.

Suppliers may need to adjust prices to reflect the cost increases, Mr Gan said, adding: “Higher global food prices will, in turn, exert upward pressure on domestic food prices.”

“Global prices for food commodities such as cereals and vegetable oil have risen due to supply constraints arising from weather-related disruptions, manpower shortages and export restrictions in key food-producing countries, amidst rising global demand,” said Mr Gan.

Meanwhile, he said, supply bottlenecks for such things as semiconductors, coupled with congestion at ports everywhere have pushed up prices of imported consumer goods here.

North East District Mayor Desmond Choo Pey Ching had also asked Mr Gan what is the expected inflation over the next year and its key drivers.

“CPI (Consumer Price Index)-All Items inflation picked up to 2.5 per cent on a year-on-year basis in the third quarter of 2021, from 2.3 per cent in the second quarter,” said the minister, citing the same bottlenecks.

Despite the increase in inflation, he said, “Singapore’s economic recovery for the year remains on track”.

The government will also continue to help families in “various ways” to cushion the impact of higher food prices, said Mr Gan.

He cited the example of ComCare cash grants to low-income households from the social service offices of the Social and Family Development Ministry, to help with living expenses.

“The Budget 2020 Grocery Vouchers Scheme has also helped less well-off Singaporeans with their household expenses during this period of economic uncertainty,” he added.

About 160,000 eligible Singaporeans received S$100 worth of grocery vouchers last month under the Care and Support Package./TISG

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