LAHORE, Nov 2: Troubled northern areas have helped stabilise flour market in most parts of the country as trade routes are blocked and the trucks, initially sent to the tribal areas and Swat Valley, have got stuck there.

Traders from Punjab say now no one can risk sending fresh supplies to these areas for fear of loot and money getting stuck with the local traders. With supplies to these areas virtually coming to a halt, all supplies are now concentrated in the settled area of the country.

Although a glut-like situation is building in most of the urban areas of the country, the price has not come down as the government had recently increased the base price and no one is ready to sell flour at less than that, according to traders.

Meanwhile, the Punjab Food Department on Friday increased wheat releases to the millers to meet the traditional additional demand during the first few days of every month (when the salaried class goes for the purchase of monthly ration).

It increased releases from 30 bags per body to 35 bags from Nov 3 to 13 for the additional demand — from a total daily release of 13,500 ton to 15,500 to 16,000 ton.

According to Director Food Arif Anwar Baloch, the department would revert to 30 bags per body from Nov 13. It would repeat the increase during the first 10 days of December and convene a meeting of millers to re-assess the situation for the rest of the season.

He said with the current releases, the department should be comfortable with its stocks of 2.124 million ton and additional supply of 150,000 ton from the Pakistan Agriculture Services and Storage Corporation (Passco). With the arrival of imported wheat, he hoped, the situation would totally ease for the rest of the season.

Muhammad Arshad, a flour trader from Lahore, maintained that a glut-like situation had already started developing because of virtual stoppage of supplies to Swat Valley and beyond and the tribal belt because of volatility in those areas. But, even this situation might not benefit the common customer because of increased base price; the government had recently increased ex-mill price from Rs273 to Rs285 per 20kg bag. Otherwise, the flour supply situation had eased a bit and would further improve as circumstances suggested.

Roughly 10 to 15 trucks were taken to Swat Valley and double that amount to Waziristan and around and these supplies had stopped, Shabbir Ahmad, another trader from the city, said. He, however, believed that it was more of a psychological satisfaction than actual benefit trickling down through market stability in the central and upper Punjab.

Like other commodities, he said, it was the speculative pressure that ruled the flour and wheat trade markets.

“Around 50 trucks of supplies do not matter much in actual terms, but there is more of a rumoured sense of relief. Nevertheless, one should be optimistic about price as the hoarders have much more capacity to absorb and they would continue doing so till situation in these areas improve”, he explained.