THE retail cost of wheat flour across the country has surged as never before, putting additional pressure on consumers already battered by food inflation. With a new wheat harvest in Sindh and Punjab at least two and three-and-a-half months away respectively, there appears to be little possibility of relief in flour prices over the next several weeks. The recent spike in wheat prices over the last one week or so, to around Rs4,300 per 40kg, has made the domestic market nearly 30pc costlier than its international counterpart. Likewise, the gap between the official rate at which the Punjab and Sindh governments release their stocks to the mills and the open market has also widened to up to Rs2,000 per 40kg from Rs1,200-Rs1,300. What has led to market dislocation in the span of a few days remains a mystery. Some market watchers blame the Sindh chief minister’s statement that his province did not have enough wheat stocks to last it beyond the middle of next month. Others say that late sowing in Sindh, due to the summer floods, has spawned expectations of shortage of the cereal in a month or so. Still others claim that the reduction in the daily wheat quota of mills, compared to previous years, is responsible for the jump in flour prices. But, the government insists that the country has sufficient stocks to last till the new harvest.

Whatever the reason, this isn’t good news for people struggling to cope with an average food price inflation of over 31pc since July. Skyrocketing flour prices, which are touching record levels of up to Rs135 per kilo, have put this staple out of reach for low-middle-income households in the country, raising fears of increased food insecurity. The official response to the problem has been a crackdown against the ‘hoarders’, even though such reactionary measures have never worked in the past. The situation demands that the government ramp up imports to fill the supply gap and stabilise flour prices.

Published in Dawn, December 27th, 2022