It's a more expensive Chinese New Year
COMPLAINTS about Chinese New Year getting more expensive is something that many are probably familiar with. So are we.
The Business Times has compiled its inaugural BT Fa Cai index to provide a picture of what the damage is like each passing year.
First, the bad news: The Year of the Horse may bring good fortune, but it could also saddle Singaporeans with the steepest increase in festive-food prices in three years.
The good news: Wages have moved in tandem, and look set to outpace Chinese New Year inflation.
We tracked the average price of an equally weighted basket of four popular festive items - mandarin oranges, beer, abalone and bak kwa - in the weeks before each Chinese New Year.
With 2010 prices normalised to 100, the same basket of goods costs 115 this year. Against year-ago prices, this year's basket costs 4.32 per cent more, the largest annual increase since 2011.
The question of affordability is more complex. Comparing against nominal wages, the index outpaced incomes over a two-year period between 2010 and 2012. On just a one-year basis, the 2012 basket actually grew slower than wages, but that was partly because the basket was coming off an unusually high base in 2011.
But some relief could be due. Current forecasts of wages for 2013 and 2014, gathered from polling economists, suggest that incomes could rise faster than the index for those years, both against 2010 levels and year-on-year. The wage comparisons are, of course, based on averages, so affordability is likely to be different for most Singaporeans.
Leading the charge this year were mandarin oranges, whose prices rose over 15 per cent from last year. Sheng Siong supermarket told BT that a reduced supply of large-sized oranges this year could be a reason for the rise. Mandarin oranges were smaller this year, with a lower harvest, it said.
A box of 18 oranges now costs an average of $7.05. The same amount would have bought 27 oranges in 2010. Higher costs have played a part in this trend of rising mandarin prices since 2010, said Mr Tay Khiam Back, chairman of the Singapore Fruits and Vegetables Importers and Exporters Association.
Packaging, local transport, as well as labour costs in both China and here, have increased since then, he said.
Bak kwa and abalone suppliers echoed a similar dilemma.
Mr Rod Lim, owner of Lim Chee Guan, said labour costs were "heavy".
Prices for sauces and sugar have been increasing over the years as well, he said. "Prices go up a few times and come down one time."
Bak kwa prices on the index rose marginally this year to $49.92. Compared with 2010, however, the bill now is 9.3 per cent higher.
Tough abalone-harvesting weather, bush fires in Australia that raise animal-feed prices, and dry spells that shrink mandarin harvests are all examples of weather wreaking havoc, industry players said.
Weather was a contributing factor behind the 10 per cent spike in the index in 2011 as well.