What is the relationship between the decline of the pound and the rise in the prices of “Ramadan Yamish”?

Yamish prices jumped by rates reaching 200% (Al Jazeera)

Cairo -

A decline in supply and a reluctance to demand are the mouthpiece of the Ramadan season in Egypt after a difficult year of dollar scarcity and the decline in the value of the pound, which led to an unprecedented jump in the prices of nuts and dried fruits known as “Ramadan yams.”

Yamish is a group of seasonal food commodities whose trade in buying and selling flourishes before the month of Ramadan. It is one of the manifestations of celebrating the arrival of the holy month. Markets and shops are usually crowded with shoppers, buying and selling in large quantities sufficient for the month.

But the feelings of joy and celebration of purchasing yams in preparation for welcoming the holy month turned into astonishment and astonishment among a wide segment of citizens, as a result of the significant increase in prices, whether popular or imported, between 100% and 200%, according to merchants and importers.

Big price hike

Egypt imports about 90% of Ramadan yams from abroad, and the import bill reaches more than 3 billion pounds at the dollar price in the parallel market, or the equivalent of about 50 million dollars.

There is more than one price for the dollar due to the scarcity of hard currency, such as the black market dollar, the gold dollar, the iron dollar, the car dollar, etc. The official price is 30.85 pounds, and on the black market it is about 50 pounds.

Yamish Ramadan faces calls for austerity and reducing spending (Al Jazeera)

During the past two years, for example, the price of coconut, the most popular in Egypt and the most widely used, rose from 70 pounds to 100 pounds and then 180, and the local and most widely used peanut from the level of 40 pounds to 80 then 140 pounds, and the price of local raisins rose from 50 pounds. To more than 100 pounds.

The scarcity of the dollar and the devaluation of the pound were reflected in prices, and thus prices were reflected in the customs and traditions of many Egyptian families, and “austerity” was imposed on them to varying degrees and in different forms, the least of which was confinement to purchasing limited quantities.

Government initiatives to alleviate the crisis

In an attempt to contain the growing anger over the increase in the prices of Ramadan goods and the widespread complaints among people about the high prices, the Egyptian government announced measures aimed at providing goods at reduced prices, such as the “Welcome Ramadan” exhibitions and the “We Are All One” initiative.

According to the government, there are 3,000 outlets nationwide for the “We Are All One” initiative, and thousands of outlets and chains with “Welcome Ramadan” and discounts ranging between 15% and 30%, including major producers of food and Ramadan goods.

Pavilions will also be allocated for the exhibits of the Holding Company for Food Industries at the Ministry of Supply and Internal Trade and its subsidiaries, in addition to allocating spaces for the National Service Agency at the Ministry of Defense and “Aman” at the Ministry of Interior.

Regarding what is being raised about the deteriorating quality of goods sold in the initiatives, the government confirmed that the goods offered in outlets are the same as those offered in the markets, but at reduced prices, and they are available to citizens only and their resale is prohibited.

More than 80% of Ramadan yams are imported from abroad (Al Jazeera)

Reduce spending

Citizens met by Al Jazeera Net's correspondent in the markets say that prices increased more than expected and imposed a new, more austere reality, and families must either adapt to the new prices, rationalize spending, or boycott yamish, which is unlikely given people's eagerness to celebrate the holy month of Ramadan.

They made various statements about the necessity of reducing quantities and being content with necessities or purchasing as needed, dispensing with imported nuts and dried fruits, and getting used to the local product. Also, by reducing spending, one of the goals of fasting is achieved.

3 reasons for high prices

Magdy Tawfik, Vice President of the Perfumery Division at the Cairo Chamber of Commerce, attributed the sharp rise in the prices of Ramadan yams to the fact that “the majority of types of Ramadan goods come from abroad, and were affected by the rise in shipping prices by sea, the rise in their prices from their sources, and above all the decline in the value of the pound against the dollar.”

But he explained in statements to Al Jazeera Net that the price increase was not limited to imported goods, which increased by more than 200%, but also affected the cheaper local and popular goods, such as peanuts and some types of local raisins, dates, dried dates, and hibiscus, whose prices increased by more than 100%.

Merchants are not happy with this high price - according to Tawfiq - because “capital has declined in value and the capital cycle has slowed down, and the more reasonable the prices are, the greater the demand, the greater the purchasing power, the better the movement of trade, and the quicker movement of capital,” noting that there is a supply in the markets, but there is no longer. Purchasing power that can buy the same species in the same quantities as was the case in previous years.

The Deputy Head of the Apothecary Division in Cairo expects that until the economic crisis is resolved, the Egyptians’ Ramadan habits will change clearly, and he said that they can be summarized under “rationalization of spending.”

The pound fell

The government and local media blame merchants for the rise in prices, while a member of the Board of Directors of the Foodstuffs Division of the Cairo Chamber of Commerce, Ali Hashem, denied that “the increase is due to what is said about the exploitation, monopoly, and greed of merchants, describing it as a peg to suspend failure, and it is merely allegations to justify.” The government's failure to address the economic crisis.

He added, "It is inconceivable that all merchants from northern to southern Egypt are greedy. There may be a percentage who behave incorrectly, but the majority are not like that."

Local Ramadan yams, such as dates and raisins, catch up with imported prices (Al Jazeera)

He explained in his speech to Al Jazeera Net that the large increase in the prices of Ramadan yams was expected, especially since more than 80% of it is imported from abroad, such as nuts, coconuts, apricots, prunes, tamarind, and dried figs. He said, “In fact, it is not an increase in prices as much as It is a decrease in the value of the pound.

Ali Hashem pointed out that in normal conditions, the increase ranged between 10% and 15% each year, covered by the increase and rise in wages and salaries, but with the sharp decline of the local currency, prices rose in the same way.

Regarding the “Welcome Ramadan” exhibitions and the government outlets and consumer complexes, Hashem downplayed their impact, and considered the reduction rates to be like the skin of the core. If the increase is at a minimum of 100% - the same speaker says - then the reduction does not exceed 10% or less, and you will not be able to sell. Goods at last year's prices, and in short, they are to beautify the government's image, nothing more and nothing less, according to his expression.

Hashem believes that if the government wants to reduce prices, it must support factories and companies and reduce the prices of energy, fuel, licenses, and fees in order to reduce the cost of production, indicating that producing companies and factories will not sell at less than the cost price and at a loss, and in the end the consumer has no choice but to regulate spending until the crisis passes.

Source: Al Jazeera