Shortage of dollars paralyzes importers of gas and milk | Print edition
By Chrishanthi Christopher
A shortage of US dollars has hit importers of LPG (liquefied petroleum gas) and milk powder, who are struggling to meet payments to suppliers.
Laugfs Gas Plc said it was behind in payments and could not distribute enough LPG gas to meet domestic demand.
WHK CEO Wegapitiya said that although gas containers are available at the Port of Hambantota and at the company’s storage and filling facilities in Mabima, the company was unable to open letters of credit for pay suppliers. The company had approached public and private banks in vain.
To release the shipment, the company must open letters of credit worth $ 10 million, but local banks were unable to provide the necessary volume and were only releasing the currency up to the level. of $ 500,000 every two to three weeks.
With increasing gas shortages, people across the country are lining up at Laugfs gas outlets in the scorching sun, carrying the company’s yellow bottles for refills.
Demand was not deterred by the government’s green light for an increase in the price of Laugfs gas. A price increase of Rs. 363 on a 12.5kg gas cylinder was approved last month.
Mr Wegapitiya said the shortage was due to the company having suspended distribution during the period when it demanded a price hike.
A reduced workforce in its factories, due to infection with COVD, exacerbated the problem.
âEvery day another worker turns positive and we end up with fewer workers,â he said.
Despite this, the company releases around 200 to 300 metric tons per day. âThis is the amount we are using to deliver before the price increase,â Mr. Wegapitiya said.
Meanwhile, powdered milk shortages continue, with supermarket shelves emptying of product as prices rise.
The Milk Powder Importers Association said its members are also facing the problem of acquiring US dollars to import supplies.
Member Lakshman Weerasooriya said exporting companies demanded more local currency for the dollar.
âThe dollar is currently Rs. 228, but companies charge 10 rupees more,â he said.
The companies had previously lobbied for a price increase of Rs. 945. âIt was in January when the dollar rose to Rs. 210 to the rupee,â Weerasooriya said.
“We will have to increase the price per kilogram to at least Rs. 1,350,” he said.