A severe sugar shortage in the market and a serious risk of price increases.

The Essential Food Importers' Association warns that due to the continuous depreciation of the Sri Lankan Rupee against the US Dollar and India's temporary halt on sugar exports, there is a serious risk of a severe sugar shortage and price hikes in the domestic market in the coming period. The association further points out that, in addition to sugar, prices of several other essential consumer goods, including milk powder, could significantly increase in the future due to this situation.

Due to this emergency export ban imposed by India, effective from May 15th until September 30th, local importers have taken steps to turn to alternative countries. Accordingly, businesses are making strenuous efforts to purchase sugar from Thailand, Brazil, and several countries in the European region, and steps have already been taken to order sugar from Brazil. However, it is estimated that due to long shipping routes and delays in supply chains, it will take at least two months for these sugar stocks to reach the country.

Although the Indian government has not imposed restrictions on the export of refined sugar, its higher price compared to regular sugar has become an issue. A spokesperson for the association states that these high prices will be another unbearable burden for consumers amidst the existing cost of living pressure. Furthermore, due to the direct impact of the depreciation of the local rupee and the increase in import costs, prices of milk powder, dhal, canned fish, various types of rice, and imported potato varieties are also expected to rise in the coming weeks.

They also point out that if the value of the local currency further depreciates against the dollar, importers will face severe difficulties in securing the foreign exchange required to order new food items. However, despite these existing fears and concerns, the Essential Food Importers' Association confirms that there are currently sufficient sugar stocks in the country for approximately two months. Traders also express fear that due to this overall situation, there is a risk of a new wave of food inflation emerging in the future.