KARACHI: The flour prices, after witnessing a decline of Rs2 per kg prior to arrival of the first Ukrainian ship in the last week of August, have again started crawling up as Sindh millers raised rates of various varieties by Rs1.50 per kg.

Millers have fixed the flour No.2.5 at Rs57.50 per kg, followed by Rs61.50 per kg for fine and super fine flour, respectively. The price of a 10-kg flour bag is fixed at Rs580 as compared to Rs565. Consumers would definitely pay a higher price than the mill rate depending on the profit margin of the retailers. However, branded varieties are being sold at Rs700 per 10kg bag.

Pakistan Flour Mills Association (PFMA) Sindh Zone Chairman Khalid Masood attributed the price hike to rising rates of local and imported wheat in the open market.

He said the local wheat rate reverted to Rs5,200 per 100 kg bag on Friday. Earlier, it fell to Rs4,800 from Rs5,200 following the arrival of the first Ukrainian wheat consignment at the Karachi Port in the late August, he said.

Ukrainian wheat brings no relief

According to the PFMA, price of imported wheat has also increased to Rs4,800 per 100 kg bag, an increase of Rs200 per bag in the last one week.

Masood said he requested the Sindh government on Friday to start releasing wheat to the millers from the provincial crop otherwise flour rates would remain under pressure due to rising price trend in imported wheat in the open market.

Arrival of imported wheat has averted a big jump in price of flour since millers are blending imported and local wheat with a 50:50 ratio, he added.

Consumers have yet to get any benefit from the arrival of 195,000 tonnes of Ukrainian wheat. So far, three shipments have arrived since late August and more vessels with wheat are expected to arrive in the next few weeks.

The Sindh government had procured 1.25 million tonnes of wheat this season from growers but so far its issue price had not been fixed. The provincial government may issue wheat to the millers from next week.

Local traders had booked 600,000 tonnes of wheat at an average price of $235 per tonne while Ukrainian wheat rate has swelled to $250 per tonne after massive buying from various countries.

A group of four to five millers had also booked 65,000 tonnes of Ukrainian wheat at the rate of $227 per tonne. The landing cost would be Rs4,300-4,400 per 100 kg bag. The wheat cargo is expected to arrive in the last week of October.

Published in Dawn, September 12th, 2020