KARACHI, April 25: The owners of 140 flour mills are on a warpath with the Sindh Food Department and have announced an indefinite closure of their operations from Monday to protest against the suspension of eight of their colleague's licences.
The millers are also angry over the hurdles that have allegedly been placed by the authorities in the procurement and transportation of wheat from farms in the interior to Karachi. They have picked up the Food Secretary Mir Mohammad Parihar as their target, demanding his removal from office.
Mr Parihar has blamed the millers of refusing to accept any discipline as they wanted the wheat business to be conducted on their own terms. "If there is a food department in the province, it has a job to do and a writ to invoke," he remarked and maintained that whatever has been done was in the interest of the people and fell within the framework of law.
Efforts made by this reporter to reach the Food Minister Arif Jatoi to seek his comments on the situation, which could lead to a serious wheat and flour scarcity in the province, proved futile, however.
Meanwhile, as the situation gets murkier in Sindh, the senior officials of the food departments of all the provinces and federal food ministry will meet on Monday in Islamabad to take stock of the wheat position.
The immediate issue confronting them is whether the Sindh and Punjab provinces are within their right to impose official or unofficial restrictions on inter-district and inter-province movement of wheat and flour. At issue is also the demand made by Sindh for at least 1.8 million tons of wheat to meet its deficit.
In a representation to the federal government, which is full of venom against the food secretary, the millers of Sindh have wondered as to how they can sell flour at the government fixed prices when wheat is made available to them at Rs10.50 and Rs11 a kilogram from the open market.
"The Karachi public is now on the brink of starvation because the flour mills in Karachi are dry," said the millers' association. They have alleged that they are being denied the purchase of wheat directly from the farmers in Mirpurkhas, Hyderabad, Sanghar and Nawabshah.
The millers maintain that the Sindh government has imposed some unofficial restrictions on inter-district movement of wheat to facilitate official procurement operations. "But the government has not been able to procure even 10 per cent of the wheat harvested so far," claimed a miller.
The millers also say that about 700,000 tons of wheat have been harvested in lower Sindh. "Where has the 90 per cent of the harvested wheat gone?" asked the provincial food secretary who claimed that the millers and traders were involved in a massive purchase of wheat from the farmers and are hoarding the commodity.
The millers demand that the farmers be allowed to sell their wheat to them and also the government. Eventually when the harvesting picks up in May and the supply is augmented the prices will stabilize at Rs350 per 40 kilograms. At present wheat is being sold at Rs360 and Rs375 per 40 kilograms.
The Sindh Food department is reported to have fixed an official flour price in consultation with the millers about a month ago. But a few mills in Karachi reportedly started indulging in overcharging. The department issued notices and demanded an explanation from the millers.
"Only two mills replied," the food secretary said, pointing out that the department took punitive action only against the defaulting mills. Wheat prices in Karachi are still at about Rs12 and Rs14 a kilogram in retail.
The situation now is far better than what was prevailing about a month ago. There are hopes that the situation will get better as harvesting picks up. But the new tussle between the millers and food department has created confusion which is bound to help the speculators.
Market analysts say wheat purchase and its hoarding has become a new game in the interior of the province. Even a few bank employees are said to have arranged loans for their close friends or relatives for the purchase and hoarding of wheat in anticipation of a swift price spiral in the next few weeks.
"The best solution is to set the market free and allow an unhindered supply of wheat from the fields to shops," said a representative of the millers. "In fact this is the only solution to the problem the speculative traders are trying to create."
The State Bank of Pakistan in its recently released quarterly report has drawn the government's attention towards speculative trading of wheat because bank loans are available freely and on very easy terms. The State Bank has advised the framing of anti-trust laws and measures to check this speculative trading.
However, so far no one seems to be paying heed to this advice and as things stand today the stage has been set for a tug-of-war between the millers and the food authorities. Those who stand to suffer most are the growers who do not get a fair return because of the powerful lobbying of commodity brokers and consumers.
