LAHORE: Millers and Punjab Food Department blame each other for the increase in prices of wheat and its products.

Pakistan Flour Mills Association Chairman Asim Raza claims that the ban on storing more than 200 maunds of wheat has led to Rs75 per 40kg further hike in wheat price as its rate in the open market has reached Rs4,725 per 40kg, while the rate of 20kg flour bag has touched the mark of Rs2,800 per bag.

If the situation persists for some more days, he fears a ‘further’ shortage of wheat and consequently, the flour becoming more expensive.

A spokesperson for the food department rejects as implausible the reasoning put forward by the millers that action against hoarding is leading to the increase in the prices of the staple food.

“The department has investigated the issue of rising prices of wheat and it has come to light that some profiteers and hoarders among the flour millers are involved in the ugly business of stocking the wheat purchased at Rs3,900 per maund and inflating the prices by creating an artificial shortage of the commodity in the market,” says the spokesperson in response to a Dawn query.

He claims that some flour mills have stored their wheat with stockists due to which they are opposing action against the hoardings.

“Also, during the past years, it has been the practice of the flour mills to blackmail the government by increasing the prices of flour to get the wheat quota from the government ahead of time and forcing it to release the wheat quota earlier.

“The wheat quota system has been a source of massive looting in the past and the government exchequer has been damaged by taking subsidised wheat and selling it at high prices in the market. A transparent system is being prepared to end this looting system,” he adds.

It may be mentioned that the government procures between 3.5-4.5 million tonnes of wheat through the food department at harvest times in April and May and releases it at subsidised rates to the flour mills as per their quota usually in October.

For the four months — June, July, August and September — the millers use the wheat for milling they directly purchase from the open market.

Published in Dawn, July 15th, 2023