December 24, 2007	Monday	Zilhaj 13, 1428

LAHORE, Dec 23: The flour situation eased a bit in the province during the Eid days as the Punjab food department released additional 5,000 ton to mills in Rawalpindi and Lahore.

The `Eid quota’ was in addition to 21,000 ton daily releases, which, according to the department’s claim, was more than double of the province’s requirement. But, with the NWFP and Sindh releasing less than 50 per cent of their requirement, the situation is finely balanced.

According to the food department officials, the NWFP has just increased its releases to 3,000 ton, with a claim that it is catering to 50 per cent of its requirement. But, the millers from the North West Frontier Province have written a letter to the federal government that their daily requirement is over 10,000 ton. They have based their calculations of all settled, federally administered and provincially administered areas.

If the millers’ claim is taken as a benchmark, the NWFP is still releasing 30 per cent of its needs. The rest of it is being met from Punjab, which ends up feeding the entire country from its coffer, they say.

The officials say the situation in Sindh is not any better as it is also releasing only 50 per cent of its requirement in the current dry market scenario. With wheat sowing nearing completion, market in even rural areas dries up quickly, putting additional pressure on city stocks.

At present, the Sindh’s requirement has gone beyond 8,000 ton. But, it is releasing more than 4,000 ton a day. Thus, both the provinces leave a gap of 11,000 ton a day, which the millers are meeting from supplies from Punjab because all free markets equilibrate themselves, they say.

A department official says: “This situation puts extra pressure on the Punjab victuals, and twists market against the consumers. As far as the country has more wheat than its requirements, the situation remains under control. But, even a small deficit magnifies vulnerabilities of the market.”

The Punjab food department is releasing additional grains with a hope of getting imported wheat. Though the import has started trickling in, but it is yet to gain the required momentum. Only 66,000 ton wheat has actually arrived in the country from abroad. The department hopes that the stream will swell in the coming days to ease the stock situation, he says.

“The situation has temporarily eased, but it may come under pressure in the beginning of January when the salaried class goes for bulk purchase,” says Rao Akram of the Karyana (retail) Merchant Association.

One must not forget the fact that the department had around 3.9 million ton wheat last year and it ended up releasing all of it in domestic market except for 125,000 ton export to keep the price under control, he says.

This year, it will not go beyond three million ton even if purchase from Pakistan Agriculture Services and Storage Corporation (Passco) and import, if the entire quantity comes through, is also included. All wheat market watchers are aware of this scenario and are exploiting it to the hilt, Rao claims.

He says the government has to deal with it through massive on-time import and flood the market.