GEORGE TOWN: Chief baker Khoo Kay Poh needs hundreds of Grade A washed eggs each day and several 25kg tubs of butter every week to bake the dozens of cakes he sells in Pulau Tikus.
The eggs used to cost just over 40 sen each but are now priced at more than 60 sen while the tubs of butter have gone up from RM300 before the pandemic to RM900 now.
With the festive period coming soon, it’s a double whammy for bakeries.
“We have to use Grade A washed eggs. When you break hundreds of eggs to bake dozens of cakes a day, you have no time to wash them.
“We can’t use eggs with bits of feather and dirt on them because it would contaminate our cakes.
“We must get eggs only from suppliers who wash them first,” said Khoo, 63, whose cake-and-cookies shop near the Pulau Tikus market has been around since 1984.
The bakery gets hundreds of eggs delivered every morning.
Then comes the all-important pure butter, the price of which has also skyrocketed.
“I tested with cheaper butter and Grades B and C eggs. The cakes do not taste good,” he lamented.
Khoo’s account of butter prices matches a recent report by the United States Department of Agriculture (USDA). The Malaysian climate is not favourable for dairy cows and the country is therefore a net importer of dairy products.
According to the USDA, America’s supply of butter in storage this August was about 130 million kg, compared with 160 million kg in August last year.
The department attributed the shortfall to inflation, supply-and-demand anomalies and labour shortage.
Khoo said that as a decades-old bakery, they depended on customer loyalty and had to maintain the quality of their cakes.
Even international hotels and large companies on the island call them for cakes during special events, so it was “impossible” to cut corners by using cheap alternatives.
“We had to increase retail prices by 10% to 20%, but not any further. If we raise prices too high, people will not want to buy, so we would rather earn less just to keep our regular customers,” he said.
In the last two months, Khoo has also lost three pastry chefs.
“They went to Singapore. There is no way we can match the salaries that Singapore bakeries are willing to pay,” he said.
At another bakery in the city, which specialises in buns, a manager who only wanted to be known as Chan also said Grade A washed eggs were priced at above 60 sen each, while prices of other ingredients had gone up by 30% or even 100%.
“We can’t raise our bun prices. We serve a local market and customers will know if our prices go up. There is little profit because of the increasing costs. We keep doing it just to keep the shop alive,” she said.
A baking supplies shop owner in George Town said his strategy was to wait for importers’ warehouses to be filled, forcing them to announce wholesale discounts.
“They order from manufacturers abroad every three months. When their next shipment is due, they announce discounts on their current stock to make space for new arrivals.
“Then, I order as much as I can so I can give the best prices to my customers,” said the shop owner of 20 years.