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Consumers groan as food prices rise by 50%

By on April 25, 2016

Following the persistent shortage in fuel supply and the harsh economic climate, there has been an average of 50 per cent hike in the prices of consumer goods and buyers are complaining bitterly.

In some Lagos markets visited by our correspondent, including Oyingbo, Iddo, Mile 12, Alade and Ipodo, prices of some food items like tomato puree, rice, vegetable oil and seasoning had increased substantially.

Our correspondent found out at the Ipodo Market that a carton of Indomie was  sold for N1,500 as against the former price of N1,000; a retail pack of Gino tomato puree(70gm), formerly offered at N1,250, went for N2,700, while a five-litre keg of vegetable oil previously sold for N1,800 was offered for N2,500.

Similarly, the price of a small bag of Semovita, which before now was N900, has gone up to N1,500. The big one is also selling for N2,400 instead of N1,800.

A small tuber of yam that sold for N250 before is now going for between N450 and N500.

The price increase has extended to rice, which now sells for N17,000 a bag instead of N15,000 a few months back.

Buyers have attributed the hike in prices, which became more noticeable in the last three weeks, to the lingering fuel crisis.

According to the Chairman, Ikeja Shop Owners Association, Mr. John Okonkwo, the fuel crisis has resulted in between 100 per cent and 200 per cent increase in transport costs.

“Before the fuel crisis, we spent N1,000 on transportation to bring goods from the depots to the city markets; but now, the transport fare has risen to N3,000,” he said.

The President, Manufacturers Association of Nigeria, Dr. Frank Jacobs, said the fuel crisis was affecting the logistics of manufacturing firms, adding that some workers were reporting late for work, while others were paying more on transportation.

The Commissioner for Economic Development, Akwa Ibom State, Dr. Emmanuel Onwiouduokit, observed that the incomes of many buyers had no command over the goods they were buying, adding that the situation had made the poor to become poorer.

Onwioduokit, who is also a member of the Nigeria Economic Council, blamed the situation on the fuel crisis.

“The cost of transporting goods from where they are produced to the markets has increased because of the cost of fuel. This has in turn affected the cost of living and actual prices of goods. It is like a cycle,” he said.

According to him, what the government needs to do is to address the cause of the problem.

“The best way to solve the fuel supply problem is to remove subsidy and allow full deregulation of the petroleum sector,” he added.

The economist also blamed the problem on the ongoing foreign exchange crisis.

According to him, the fact that Nigeria operates a consumer economy makes it easy for prices of goods and services to increase because of the depreciation of the naira.

“People have to transfer the depreciation to their prices. Even when they bought the items before now, they cannot sell it at the normal price because when they want to replace the items, the replacement cost will be higher,” Onwioduokit stated.

 

[Punch]