Business | Markets
Rice soars as prices of basic commodities rise
Consumers received another significant blow to their mounting budget problems after the year opened with more rounds of increases in the prices of basic commodities.
- By Irish Belleza, Staff Reporter
- Published: 01:06 January 17, 2008
- More than 25% increase in the cost of staples could hit low-income Asian expatriates in the UAE hard.
- Image Credit: Gulf News
Dubai: Consumers received another significant blow to their mounting budget problems after the year opened with more rounds of increases in the prices of basic commodities.
A price increase of up to 25 per cent has been observed among various consumer products across the UAE.
Click here for selected commodities prices (pdf)Rice, a staple among Asian expatriates, was particularly affected by the price hike. "All basic commodities increased by 20 to 25 per cent this year but rice has increased more," said Ashraf Ali, executive director of Emke Group of Companies that operates LuLu Hypermarkets.
Ali said the increase in the price of rice has been exceptional and "drastic". He warned that the trend of rising prices may not end soon as the country suffers the negative effects of its dollar peg.
The spiralling prices, particularly among various varieties of rice, is expected to hit Asian expatriates harder.
Moreover, a large percentage of Asians expatriates belong to the lower end of the salary scale, which only intensifies the negative effect of the price hike.
According to the latest consumer price index released by the Ministry of Economy, a 10-kilo bag of Pakistan basmati rice (muhran) has risen to Dh56.50, but is available for as low as Dh49.95. Indian basmati rice (tilda) is the most expensive at Dh45 to Dh45.50 for a five-kilo bag, while the Indian rozana variety costs Dh18.25 to Dh23.95 for a five-kilo bag.
The Pakistan basmati rice (momtaz) ranges between Dh26.25 to Dh27.75 for every five-kg bag, while the Pakistan basmati rice No.1 costs Dh30.50 to Dh43.50 for every 10 kg.
The UAE government recently announced a mandatory 75 per cent salary increase among federal government employees, while the private sector is mandated to provide at least 10 per cent salary increase.
However, consumer expenditure has remained upbeat despite the price rise.
"We didn't experience a drop in sales," said Ali, adding that the hypermarket chain experienced a supply shortage of milk, eggs and other dairy products as a result of high demand.
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