Illovo Sugar (Malawi) Limited has announced that it has increased prices of sugar by an average of eight percent effective June 2, 2016.
Illovo has attributed the price adjustment to fundamental market changes including inflation, price of electricity and the depreciation of the kwacha against the dollar, among others.
The development means that a bale of 20 packets of brown sugar, each weighing one kilogramme, is now selling at K13,054.99 while that of white sugar is now being sold at K13, 320.61.
And buyers will now need K13,106.25 to purchase a bale of 10 packets of white sugar, each weighing two kilogrammes and K12,840.63 for brown.
Before the price adjustment, consumers were buying one kilogramme of brown sugar at between K650 and K670.
Responding to a questionnaire, Illovo Publicist Ireen Phalula said the adjustment took into consideration changes in its factors of production.
Phalula, however, said Illovo is implementing stringent cost-cutting measures to mitigate the impact of the adjustment, on the consumer.
“The last sugar price adjustment was effected last year on November 1, 2015. Since the last price adjustment the consumer price index has gone up by 12 percent while inflation of our costs is greater than 20 percent. These costs are such as fertilisers and other inputs, Vitamin A, packaging materials and labour.
“The cost of electricity has also gone up by approximately 40 percent. The kwacha has also devalued against the dollar by 26 percent. As Illovo we rely on electricity to pump water for irrigation and the power adjustment stretches our production cost,” said Phalula.
She said the company has done this to mitigate the impact of the adjustment on the consumer.
Phalula added that even with the current price adjustment, Malawian sugar is still cheaper than in neighbouring countries namely Zambia, Zimbabwe, and Tanzania.