PETALING JAYA: Some Malaysians may have rushed to stock up on essential items due to the movement control order (MCO) but the average prices of many goods have remained stable so far, according to figures from the Statistics Department.
Each month the department releases Consumer Price Index (CPI) figures and related data which includes among others a list of the average prices of 100 items ranging from raw food to household appliances.
An analysis of the figures for March shows no major increases in average prices compared to the previous months, with 53 items on the list recording slightly lower average prices.
The MCO started on March 18 and has since been extended three times. The fourth phase, which starts on April 29, will end on May 12.
Amid reported shortages of certain items such as bread and toilet paper which is said to be due to panic buying, other items namely fish, seafood and vegetables saw a drop of between 20 sen to RM1.00 in average prices per kg.
Distribution problems and declining demand are among the likely reasons explaining the drop in prices for fresh produce, says Sunway University economics professor Dr Yeah Kim Leng.
“Because of the MCO, many farmers and middlemen have not been able to deliver the items to market and end up with excess stocks that they have to sell at very cheap prices to minimise losses, ” said Yeah
The MCO also means that fewer people are going out and those that do buy their supplies less frequently.
Because of this, Yeah reckons that some people may prefer to buy more processed food which lasts longer.
The department’s March CPI for “Food at Home” recorded a 0.2% decrease from the previous month, with vegetables (-1.6%) and fish and seafood (-1.0%) among the biggest contributor to the index.
“Restaurants and food outlet are among the biggest buyers of fresh food. Since many eateries have had to close due the MCO, we see a sharp plunge in the demand for the fresh produce, ” said Yeah.
However, he noted that although the demand for fresh produce appeared to have fallen, the demand for some other essential items which can be stored longer looks to have increased.
This is likely reflected in the department’s figures which show a total of 30 items recording higher average prices in March.
Food items labelled as “Oils and Fats” and “Meat” for instance recorded an increase of 1.3% and 0.8% respectively in March compared to February 2020.
In terms of other consumables such as toilet paper, average prices have also held steady despite reports of panic buying.
“There is a threshold in terms of the amount consumed, so although people have been stockpiling, it doesn’t contribute to the sharp increase in overall consumption of these items.” “You can see a surge in demand but then it flattens out when everybody has stocked up enough to use until the end of the MCO.”
Yeah said that it is important for the government to ensure that there is adequate supply and production of some essential items such as rice, wheat, flour and eggs to meet increased demand, especially during the Ramadhan period.
“Otherwise, it could trigger panic buying although so far we have not yet faced issues like in some other countries where there are shortages.”Check out the calculator below to see how much prices of essential items have changed in March, compared to the previous month.
Animation by Syahril Jamil and Nor Shalina. Online calculator tool by Kalarthevi, Sharifah Nurian, Mohd Rashidee, Woan Lih, Mary Anne, and Joanne Chew.
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