Economic winter kills Christmas cheer
Additional taxes on goods and services, salaries, and the unbearable cost of living have set the stage for a blue Christmas.
The prices of food, cake ingredients, festive decorations and clothing and gifts are rising by the day.
Eggs and chicken are costlier. A kilo of chicken is Rs 1,600, while red, and white eggs, cost Rs 60 and Rs 50, respectively.
Senior Research officer of Hector Kobbekaduwa Agrarian Research and Training Institute (HARTI) Duminda Priyadharshana told the Sunday Times that prices of chicken, eggs, and vegetables have peaked.
“This is the off season for vegetable cultivation. There is limited supply.’’
However, he points out that the price increase will be short-lived. As consumers shy away from expensive commodities, prices will drop.
Bakers are facing a multitude of operating costs, not just the prices of ingredients and shortages. Bakery Owners Association’s president N.K Jayawardena said that orders have dropped and people are buying less. Out of 7,000 bakeries only 5,000 are operating, he said.
M r Jayawardena said that about half of the bakeries now operating, had stopped baking cakes, Christmas cakes, and festive meals.
“Eggs are not available. Apart from that, most large-scale poultry farmers sell eggs upwards of Rs 60. They do not even deliver eggs to us anymore, we have to go to them and buy more,” he said.
Both large and small-scale bakery operators said that seasonal business has fallen.
An employee of a large-scale bakery in Slave Island, Arumugam Nadaraja said Christmas sales, so far, are not encouraging.
“Electricity charges and gas prices have increased the costs of baking cakes, pastries and bread. We have even stopped making Christmas cakes as the raw materials are too expensive,’’ he said.
Home bakers are also discouraged by higher costs.
The price of flour, cocoa powder, vanilla, eggs and butter, on top of electricity charges, have forced bakers to increase the prices of cakes, said home baker Mrs S Shafraz. “I bake cakes as a side business. This year’s year-end festive period is the worst. I only had few orders compared with the past two years, when the country was facing a (coronavirus disease) pandemic.’’
She sells a kilo of icing cake for Rs 5,000, while a butter cake sells for Rs 22,000 to cover the extra costs.
Sales of Christmas decorations, too, have dropped due to import restrictions.
Ravindu Promodya, an employee of a prominent home goods store in Kohuwala, said sales have at their lowest.
Since November the stores had not been able to import from China due to restrictions.
“We had to sell leftover Christmas decorations which we had imported and stored in past years. Our Christmas sales have reached the lowest in fifteen years,” he said.
Mr Promodya said that many customers are not interested because there are no new imported items.
A merchant at Pettah, Deva Kumara said the import ban means there are very few plastic Christmas trees and prices are high.
He charges Rs 350 for a decoration set. He said decorations worth Rs 150 are sold wholesale for Rs 300.
Event planners, too, expect less activity, compared with pre-pandemic years. An assistant manager of an event planner at Wijerama Mawatha, Akilesh Joseph, said that the mindset had changed during the pandemic. So, simple events are being favoured along with acts of sharing.
“The high cost of living and electricity expenses, too, have driven people towards not having big events. We did not receive any lighting decorations inquiries this year,’’ he said.
Lavish Christmas lunches and dinners will not be possible for most.
Bank employee and resident of Kotahena, Chandima Malkanthi Hirimuthugala told the Sunday Times that her Christmas table will be smaller in scale.
Decorations sold at the Pettah are five times that in the previous year.
“The merchants are claiming import restrictions and raising the price of decorations. A decoration previously sold for Rs 100 is now Rs 500,” she said.
Tharindula Peiris, who works at a private company, said that the Pettah traders are raising prices of Christmas trees every day. In three days, he had been quoted prices of Rs 14,500, Rs 19,500 and Rs 22,500. Prices online had increased, as well.