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Canteens stop milk tea after milk powder price hike

31 Dec 2021

BY Buddhika Samaraweera The Milk Powder Importers’ Association (MPIA) has decided to increase the prices of imported powdered milk with effect from last (30) midnight, with canteen owners parallelly announcing the suspension of the sale of milk tea. The price of a kilogramme (kg) packet of milk powder which was priced at Rs. 1,195 has been increased by Rs. 150, making its new price Rs. 1,345. The price of a 400 grams (g) packet of milk powder has also been increased by Rs. 60 and it will now be sold at Rs. 540. The All Ceylon Canteen Owners’ Association (ACCOA) has decided to suspend the sale of milk tea from yesterday due to the increase in the milk powder prices. ACCOA Chairman Asela Sampath told The Morning that considering the current price of milk powder, the price of a cup of milk tea should at least be Rs. 80. However, he said that it was decided to withdraw from the sale of milk tea as consumers could not afford such a high price. Earlier, the MPIA hiked the milk powder prices on 9 October. The said price hike was followed by the Government’s decision to remove the control prices imposed on several goods including milk powder. Accordingly, the price of a kg of milk powder was increased by Rs. 250 to Rs. 1,195, while the price of 400 g of milk powder was increased by Rs. 100 from Rs. 380 to Rs. 480. Despite the price hikes, there is a shortage of milk powder and people have been seen waiting in long queues to buy milk powder in many areas. In this backdrop, the milk powder importers have pointed out that the current shortage of milk powder could continue for another one or two months due to difficulties in issuing letters of credit (LCs) for importing milk powder and delays in transportation. Speaking to the media last Wednesday (22), MPIA Media Spokesman Ashoka Bandara said: “There is a shortage of milk powder in the market at present. However, we don’t think that this shortage can be overcome in as little as a week or two. It will take at least a month or two.” He further said that the main reason for the current shortage of milk powder is the deficit of US dollars in the country. The main reason for the shortage of milk powder is the problem of issuing LCs from banks due to the shortage of US dollars in the country, he said.  

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