Business leader calls for price watchdog, expects more price rises

By Emmanuel Joseph

As consumers navigate rising food prices, a key private sector leader is recommending the formation of a broad-based independent monitoring group to help Barbadians make more informed spending choices – while urging the public to brace for more price hikes.

Anthony Branker, former president of the Barbados Chamber of Commerce and Industry (BCCI), has suggested that shipping delays through the Suez and Panama canals resulting in supply chain disruptions would likely trigger high prices.

But while imported products may get more expensive according to Branker, goods made here have so far been spared supply issues, John Marshall, the head of the country’s manufacturers group has told Barbados TODAY. Marshall said he does not foresee any problems for at least the next three to six months.

Referring to the advocacy group, the Barbados Consumer Empowerment Network (BCEN),Branker conceded that an independent body in addition to the Ministry of Commerce and Consumer Affairs was needed to impartially assess prices in the interests of all Barbadians.

“The majority of private sector entities would fully support that,” Branker told a Voice of Barbados Down to Brass Tacks audience on Thursday. “The Ministry of Commerce, I know they do pricing surveys; I know for a fact that they also now monitor freight costs, but it is not published so that persons can get an idea where the changes are happening.

“So, I suggest that the ministry go back [to] publishing pricing where persons can see and make judgements on where is the best place to spend their hard-earned money.”

He acknowledged that a broad-based monitoring agency may be better placed to determine how and to what extent costs are passed onto consumers so they would not be caught unawares.

“I think that there has to be a broader approach to it,” the former BCCI leader said. “The port costs, the fees that you pay at the port to move a container through the port, [are] just one component of the overall costs. So, if you do not pay attention to the actual freight to move products from South Florida, or to move products from Singapore or from Australia – wherever it is coming from and you do not pay attention to that – you are missing the most significant component.”

Branker stressed that importers paid duties on the total price of cost, insurance and freight (CIF) not on port charges.

“If the freight costs are moving and you are paying duty on that, the costs of the goods to the consumer will be higher,” he argued.

Prime Minister Mia Mottley, in a national address, told Barbadians to expect a 17.5 per cent decrease in container fees charged by the Bridgetown Port, saying the government would monitor the anticipated decrease in prices to be passed on to consumers.

In addition to a 10 per cent cut last April, the charges would be cut again by another 7.5 per cent, she said.

The PM said she was not satisfied that businesses were passing on the savings from the reduced charges to consumers.

“Basically, there is nothing to pass on,” Branker insisted, adding that the prime minister failed to address all of the elements involved in determining the price of goods passing through the port.

“The port fees are just one component of getting goods to the shelves. The prime minister said there were savings when the stevedoring was transferred from the private sector to the port. She said there was a 17 per cent savings. We found it difficult to see the 17 per cent savings, But I believe that was the information given to her.

“What the prime minister did not speak to was the fact that a major component of the cost of goods…containers coming into Barbados is the actual freight. So, when the port decided to take on the stevedoring, they asked the South Florida shipping lines to take out the stevedoring fee from their freight costs, which some of them did. But after that, we have had subsequent increases that have nullified the withdrawal of that stevedoring fee,” he explained, adding that there are surcharges which are applied from time to time, and hence no net effect with increases in freight.

Branker also disclosed that the private sector was challenged with unpredictable timelines in getting goods to the consumers because of the transhipment problems that are beyond its control.

“So, it places pressure on us to keep products on the shelves, and that is what persons are seeing from time to time because of the unreliability in lead times,” he asserted.

The business leader also suggested other factors that could lead to price rises for food and household commodities based on the current transhipment problems. He pointed out that because it is taking much longer now for vessels bringing cargo from the Far East and Asia to this hemisphere for transship to Barbados, this is resulting in added fees and other charges to the containers and some items.

Branker explained: “There is also another route where cargo from Asia, from China, those places, would come through the Panama Canal; that is also having a challenge as well. So, yes, cargo coming out of those places is seeing longer lead times and increased costs. There is an adjustment to cargo which is going around the Cape of Good Hope. There is a US$1 500 per container fee that has been applied to boxes to containers that are going that route, and, obviously, that will be passed on.”

“We are seeing lengthier transit times and delays in getting some products. So, the supply chain is taking longer to fulfil some products and secondly, there are also increases. So, anything coming out of the Far East, anything coming out of that Asia area, you will see some increase in [the price] of those products,” he added.

About 30 per cent of this country’s imports originate in the Far East with the majority of goods coming from the US and UK, Branker said.

But Marshall, the president of the Barbados Manufacturers Association (BMA), declared that manufacturers were not experiencing any major challenges in getting their raw materials.

“Most of our sources are still North and South America,” he told Barbados TODAY. “Our industry colleagues. particularly in Europe. are feeling the pain of the blockade in the Suez Canal. So far, it hasn’t seemed to have affected any of our inputs as yet. You can look at soya bean futures and other things like that. Most of those commodity prices have not changed a whole lot.”

“So for us, the next three to six months we don’t see any major issues in the manufacturing sector, provided it doesn’t get any worse.”

emmanueljoseph@barbadostoday.bb