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Bittersweet tussle over sugar prices


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  • Vendors disregard Govt. control price on sugar  
  • CAA receives over 100 complaints 
  • Sugar importers say prices will start to increase by November end with new stocks 
  • Suggests price adjustments or reduced duties
  • Retailers face difficulties to keep up with no margins

By Charumini de Silva

Despite Government efforts to enforce strict laws on imported sugar prices, vendors island-wide continue to sell sugar disregarding the controlled price imposed.

The Consumer Affairs Authority (CAA) confirmed that it had received over 100 complaints island-wide about sugar sold disregarding the controlled price, a senior investigation official of CAA told the Daily FT. The Government annually spends about Rs. 60 billion for sugar imports to meet the country’s requirement.

Sugar is one of the main food items consumed in Sri Lanka. The annual per capita consumption of sugar in Sri Lanka is around 30 kg and the total annual requirement of sugar in the country is around 550,000 tons.

On 9 September, the Government made it bitter for traders by slapping a fresh Rs. 12 per kilo levy on imports with a ruling that the hike could not be passed on to consumers.

The authority is closely monitoring those in the market who are selling sugar disregarding the controlled price and conducting daily investigations island-wide.

Earlier industry analysts opined the trade would eventually pass on the additional cost to consumers since the CAA oversight is not extensive or effective.

When contacted, sugar importers said prices would only start to increase by end November with new stocks of sugar coming into the market.

“We will face difficulties with pricing only when we receive the new stocks by the end of next month,” an importer who wished to remain anonymous told the Daily FT.

Nevertheless, they suggested that the Government would have to either adjust the controlling price or bring down the duty of imported sugar with the arrival of new stocks coming to the market.

Currently, imported sugar prices continues to trade in the range of Rs. 83 to Rs. 86, while the locally produced white sugar is trading less than Rs. 80. Thus, they pointed that there is no major impact for them at present.

Further he stressed that retailers were finding it difficult to keep up the pace with them enjoying no margins under the current pricing formula.

When asked about the meeting with the Finance Ministry, he asserted that they did not pursue it as the prices at present remained stable, but added that they had handed over a written request making them understand the costing and impact on the industry.

“Finance Ministry officials are busy with the 2016 Budget proposal, and right now the prices remain low,” he noted.

 Treasury Secretary Dr. R.H.S. Samaratunga said that it was necessary to have controlling prices on essential goods like sugar to safeguard the consumers.


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