Ismail Sabri (second from left) during his recent visit to sugar manufacturer Malayan Sugar Manufacturing Co. Sdn. Bhd. at Bukit Mertajam.

Sugar will cost 20 sen more per kg from tomorrow, with the new price being RM1.65 in the peninsula and RM1.75 in Sabah and Sarawak, it was announced Thursday.

Domestic Trade, Cooperatives and Consumerism Ministry secretary-general Datuk Mohd Zain Mohd Dom, who made the announcement, said the government would also withdraw its subsidy on white bread from tomorrow and remove the commodity from the price control scheme.

He said the increase in the sugar price was necessitated by the rise in the price of raw sugar in the world market, and that the government still subsidised the price, at 80 sen per kg or RM1.008 billion for the year.

“The subsidy on sugar is retained and the amount is much higher than the subsidy in 2009, which was RM720 million.

“However, as the world price of raw sugar has risen high especially since August, from US$0.14 to US$0.16 per pound to US$0.27, the government has had to raise the price of sugar,” he told reporters here.

Otherwise, he said, the government subsidy would rise to RM1.26 billion in 2010, based on the country’s estimated consumption of 1.26 million tonnes of sugar next year.

He said the new sugar price, after the 20-sen increase, was relatively low compared with the prices in other Asean countries such as Thailand (RM2.50 per kg), Singapore (RM3.05), Indonesia (RM3.40) and the Philippines (RM3.62).

Mohd Zain said a ministry analysis indicated that the impact of the price increase on sugar-based products was minimal, about one sen for canned drinks and a cup of tea.

“For canned drinks of 325ml with an estimated sugar content of 39 grammes and a cup of tea with an estimated sugar content of 40 grammes, the impact on the price of the two drinks is 0.8 sen.

“The highest impact is on condensed milk. For the 505-gramme can with an estimated sugar content of 228 grammes, the impact on the price is 4.6 sen, which is less than five sen,” he said.

Mohd Zain said that after the New Year holiday, the ministry would hold discussions with the relevant associations to advise them against raising the prices of sugar-based products because the impact on their prices was minimal.

“Enforcement officers and price monitoring officers will go down to the ground to check on the prices of sugar-based products and advise against the raising of prices too high if such was the case,” he said.

On white bread, he said traders could raise the price of the commodity from tomorrow based on their consideration.