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UAE Freezes Key Food Prices

June 3rd, 2011 · No Comments · Abu Dhabi, The National, UAE

We have noticed it here in the Arabian Peninsula, too.

Rising food prices.

It’s a dirham (27 cents) here and a dirham there. Insidious, in that you remember getting basically the same things at the market for 100 dirhams a few months ago, and now it’s 105. It’s difficult to spot, right off, where the hikes have come from.

The government here moved to do something about the food-price creep: It has frozen prices for 400 key food and liquid and household commodities until the end of the year.

What might be interesting, for those of you living in the West, is to see how low some of these frozen prices are … and what is considered a vital commodity here.

For example:

In the West, a comprehensive list of key foods might well include potatoes, coffee and ground beef.

Not here. Potatoes are not often consumed by Emiratis. Arabs drink lots of coffee, but tea is far, far more popular among the Indians and Pakistanis who make up about two-thirds of the population. So, coffee a luxury item with a floating price … tea, a fixed price.

And the only meat/fowl price to be fixed is that of chicken, which is by far the most-consumed animal in this part of the world. Pork is forbidden among Muslims, of course. But beef is not particularly prized, and lamb and goat tend to be fairly expensive and are not considered (by the government) to be key items.

Among the list of items which now have fixed prices:

Arab bread. (The flat sort.)

Several varities of rice, which is huge for expats from the subcontinent, who make up about two-thirds of the population.

Milk, milk powder, eggs.

Pasta, tomato paste.

Sugar, salt.

Flour, foul, broad beans.

Tea, spring water.

Chickpeas, semolina,

Sunflower old. Tuna.

Ketchup, mayonnaise, chili sauce, vinegar.

Dishwishing liquid, detergent.

Foil, facial tissues, garbage bags.

Coke and Pepsi! (Considered so important to consumers, the price is fixed. Those two American companies must be proud.)

If you followed the link, again, one dirham is 27.2 cents.

Here are a couple of conversions, however:

800 grams of chicken at Carrefour (a French supermarket chain with several outlets in the UAE) is Dh12.25. Which is $3.33. And 800 grams is about 1.75 pounds of chicken. So, 1.75 pounds of chicken for $3.33. Seems like that would be a good price, in the U.S.

A liter of milk is Dh3.5, or 95 cents. A bit less than four liters makes a U.S. gallon, which means a gallon of milk is about $3.75 here. That’s higher than it usually is in the U.S., right?

Remember, too,  that very little of what we eat or drink is produced in the UAE. A few vegetables, some hardy fruits, a fair amount of chicken.

So those prices reflect what we pay for imported food. The most notable food is rice, a staple of Emirati diets — even though not a single grain of rice is grown in the country.

Who is bearing the cost of frozen prices? In theory, the market operators. But in reality I suppose it is the more affluent consumer who spends much of his money off the “fixed” list. Which I suppose is progressive: if you eat really basic things, like chicken with rice, your costs are now flat; but if you want lamb beef and potatoes, you probably will pay even more for the pleasure.

Anyway, I have a notion that when we visit California in a couple of months, we are going to be stunned by food prices. Meanwhile, here in the UAE, whatever we spend for basics … is what we will be spending on basics for the rest of 2011. If we can stick to the basics.

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