The main cause of exorbitant food prices can be attributed to black market racketeering insofar to the extent that economic conditions had led to publicly fuelled price speculation. Sources C and D show that a shortage of commodity supplies may have led to a rise in prices. A thorough analysis of all sources shows that concerns over rising prices in turn led to hoarding from both households and retailers. However, the underlying cause for price speculation is due to upward pressure from black market forces in Singapore during the post war period.

 

Contextual analysis:

These sources are from official newspapers in post war Singapore, published from 1946-1950, and can generally be trusted for reliability from an authoritative standpoint. The Straits Times remains the nation’s official news source under Colonial Singapore, and these sources are published under the British administration. In line with British interests, these sources may seek to avoid blame for food shortages on the ruling administration and instead redirect attention towards external forces such as black marketers and the general public. This is mentioned in Source C, which highlights the authoritative stance that flour is in ample circulation, and the scarcity is artificially generated. Therefore the authoritative message should be taken into account when analyzing these sources.

 

With reference from the secondary reading “Economic Change in Singapore” we gather an understanding that post-war Singapore was in a state of recovery and fraught with infrastructure. It references a period where wheat and grain was rationed sparingly in May 1947, and this is alluded to in Source C. From this we understand that there was to an extent, limited public accessibility to bread and flour. Several reasons are given for this, but most pointedly each article highlights the presence of black-market price manipulation. This corroborates with the official stance that prices were driven up primarily not because food was not in limited supply, but rather due to the presence of black-market alternatives and speculation.

 

 

Black Market Pricing:

The presence of the black market can be said to be primarily responsible for the rising prices of commodities, rather than a shortage of food in Singapore. Source A indicates that prices of sugar had risen due to “hoarding and black marketing… increases in prices due not to shortage of supply but business speculation”. Source B indicates that a “wide range of foodstuffs… are in ample supply here”. It is noted that Sources A and B provide accounts from the British citizens touring Singapore, and therefore may not be representative of the layman Singaporean. 

 

On the whole, it would appear that the rising food prices in retail are pegged to the black-market prices. This is alluded to in Source B, where Mrs Strickland is requested to pay the black-market price for rice not available for public retail. This is supported by Source C, which mentions that “flour is being trickled into the black market”, creating an artificial shortage whereby higher prices can be charged by unscrupulous retailers. These sources suggest that overwhelmingly, while there may have been limited public accessibility to food commodities, the price increase was moreso due to black market pricing rather than an acute food shortage.

 

 Excessive Hoarding and Speculation:

The rise in prices led to a compound effect whereby retailers and households began hoarding commodities, driving down public accessibility to commodities and in turn causing a rise in price. Source D illustrates that sugar is in fact being imported into Singapore for public distribution through retail, however prices had kept rising due to unscrupulous retailers and the black-market. This is further supported by Source A, also published in 1950, which indicates the price of sugar had risen. When housewives realized everyone was hoarding sugar, “practically all retail shops were cleaned up of their sugar stocks”. This indicates that public speculation and hoarding had a significant effect on scarcity of commodities, artificially driving up demand and causing price inflation.

 

Again, such goods were always available on the black market. Source D indicates that retailers would hoard sugar for sale at exorbitant black market prices, and this is corroborated in Source A with rice. These accounts indicate that prices were being driven up due to public speculation. There was no significant change in sugar supply or circulation, and yet prices were driven by a fear of scarcity.

Analysis:

Ultimately, the existence of the black market made it possible for retailers to peg their prices to an excessively high amount, fuelling price speculation from outsiders. Without a black market, the public administration would have been able to regulate the supply and prices of commodities to make accessible to the general population. The black market gave retailers an avenue for illicit sales at high prices, providing incentive to hoard. Publicly fuelled price speculation was due to fears of having to access the black market for important staples such as rice and flour. Multiple sources are in alignment when mentioning that there was ample supply of foodstuffs; the Government further mentions that there would be no plans for rationing what was already adequately supplied in quantity to sundry shops and retailers around Singapore.

 

There was a recurring long-term theme of rising prices as noted throughout the years 1946 to 1950. This would not be likely if the cause was merely short term periods of supply shocks, such as spoilt flour referenced in Source C. 

 

Through analysis of multiple sources as well as a comprehensive reading of the economic conditions in post war Singapore in my secondary source, I would agree with the statement that black market racketeering was the primary cause of rising food prices throughout the time period. The black market had a compound effect which led to public hoarding and food scarcity. From the sources, we can derive that food supply was generally in ample quantity and circulation, however much of it was being funnelled towards the black market, thus leading to a disproportionate increase in prices.

Chew Zhen Hui

G2 COR2202