KARACHI, May 19: Consumers may see an increase in prices of various varieties of flour by Re1 per kg following an increase in the price of an 80 kg atta bag to Rs1,110-1,120 from Rs1,070-1,090.

On the other hand, a leading milk producer, Milkpak, has revised its rates from Rs38 per litre to Rs42 per kg. Its half a litre pack will now be sold at Rs24 instead of Rs22, while its quarter pack will now cost Rs13 as against Rs12.

The General Secretary of Karachi Retail Grocers Group (KRGG), Farid Qureishi, said in March this year the milk producer had increased rate from Rs35 to Rs36 on its one litre pack following an increase to Rs11 from Rs10.

In June 2005, one litre Milkpak pack was selling for Rs29. While other packers are yet to follow the suit, Nesvita has increased the rate to Rs53 from Rs48 per litre.

Consumers are now hard-pressed after the failure of the city government in handling and containing both fresh and tetra milk prices.

Fresh milk is now selling for Rs32-34 a litre depending on the areas as compared with Rs30 per litre despite scores of negotiations between the city government and retailers, farmers and wholesalers.

In case of tetra milk, the city government had sought cost of production and profit margin details in February 2007 after their meeting with producers in March 2007 in which the government had expressed the desire that the price should be mentioned on the packet, besides making efforts to control its skyrocketing rates.

However, so far the meeting with milk producers has failed to yield any beneficial results for consumers.

Owing to failure of the city government to control fresh milk prices, tetra milk producers also increased the rates, and ultimately butter prices also went up two months back.

It seems that the federal, provincial and city governments appear helpless in their effort to check price spiral.

In flour varieties, increase in wheat rate to Rs1,220-1,225 per 100 kg bag from Rs1,125 some 10 days back had actually led to increase in wholesale rate of flour varieties. However, retailers said the price-hike in wholesale rate is yet to cause any flare-up at the retail stage and atta no. 2.5 (mill), chakki atta and fine atta is being sold at the old rate of Rs15, Rs17 and Rs16 per kg.

They said increase in wholesale rate of flour varieties will push up the rate by Re 1 per kg.

Retailers and wholesalers attributed the increase in rates of wheat and atta to persistent increase in wheat exports.

Before the arrival of bumper wheat crop of 22-23 million tons as against local consumption of 20-21 million tons, many producers of bread, some of them also owners of the flour mills, had already increased the rates few months back. Even roti and nan have also become costlier.

Chairman, Sindh Zone, Pakistan Flour Mills Association (PFMA), Anser Javed, said: “the government should suspend wheat exports immediately till the final actual production arrives.”

After ascertaining the accurate wheat crop size, the government can think of allowing access wheat crop for exports, he added.

However, he claimed that 350,000-400,000 tons of wheat had already been exported in the last two months which resulted in escalating wheat rate in the market followed by slight increase in atta rates.

“We have actually contained the increase in atta rates so far to avoid putting extra burden on consumers,” he said, adding how long millers can hold the increase if wheat exports continue unbridled.

“Exporters are sending wheat at reduced prices which would not earn required foreign exchange,” he added.

He said Sindh had procured 575,000 tons of wheat out of a target of 700,000 tons, while procurement in Punjab is continuing as it starts after one month from Sindh.

Chairman, Karachi Wholesale Grocers Association (KWGA), Anis Majeed, said there was an increase in the wheat rate after the government decision of allowing private sector to export 500,000 tons earlier this month.

He said wheat is being exported at $220-225 per ton FOB to India, Malaysia, and Bangladesh etc.

He was of the view that wheat prices would surely decline as soon as private sector quota of 500,000 tons for export comes to an end.