The National Association of Sachet and Packaged Water Producers has threatened to halt water production and distribution if the government fails to address the cedi’s free fall.
The Association claims that the continuous rise in fuel prices and the high cost of electricity is having a negative impact on its members’ businesses as the cost of production rises.
According to a statement obtained by Citi News, “it is important to note that packaging alone accounts for approximately 60% of the production cost for sachet and bottled water.” As of the third quarter of last year, the diesel fuel used to transport packaged water to market centers for consumers was approximately 15% of the product cost. Diesel fuel for distributing packaged water to consumer centers now exceeds 25% of the product price due to the high increase in diesel and other petroleum products. As a result of recent increases in utility tariffs, the cost of electricity, which was previously around 15% of the product price, has risen to 20% of the product price.”
“All of the above adds up to more than 95% of the last packaged water price increase announced in September 2022, without taking into account the cost of capital, salaries, wages, taxes, bank charges, regulatory fees, machine and equipment cost/depreciation/parts replacement, distribution vehicles and their maintenance costs, and other overheads.”
Also read: Fuel prices hit nearly ¢16 per litre
The association says its members may be forced to adjust their prices upward if the situation persists.
“The leadership of the packaged water industry will continue to update the public on the challenges, and if the government did not attend to the call by a week from today, we will have no option but to pass on the cost to the public and possible shutdown of production and distribution for a week across the country.”
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