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Wheat issue price fixed at Rs465 per 40kg

September 05, 2007

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KARACHI, Sept 4: The Sindh government is releasing wheat from its official stocks from Friday next (Sept 7) at Rs465 for 40kgs to flour mills in Karachi and the rest of the province with an expectation that it would bring down prices.

Wheat and flour prices touched a new peak in Karachi and elsewhere in the country hardly two weeks before Ramazan. Wheat price in Karachi was quoted at Rs1,360 per 100kg bag or Rs13.60 a kg on Monday while flour was available to consumers at Rs19 and even Rs20 a kg.

“This unprecedented price-hike in wheat and flour immediately after harvesting a record bumper crop of 24 million tons this spring has put the federal and provincial governments in a fix,’’ a market analyst replied who attributed this phenomenon to inconsistent policies of Islamabad.

“We hope to bring down wheat and flour prices by controlling ex-mill price after the government starts releasing wheat from its official stocks at Rs465 for 40kgs,’’ Ghulam Murtaza Khan Jatoi, advisor to Sindh chief minister on food and agriculture, informed Dawn on Tuesday.

The issue price of wheat has been increased by Rs50 on 40 kgs as against last year and expectation is that ex-mill wheat flour price would be Rs13 to Rs13.50 for a kg.

Consumers may be able to get wheat flour at Rs14.50 to Rs16 a kg provided the government manages an effective control on supply.

”We may announce a special Ramazan package if there is a need,’’ Mr Jatoi assured, but expressed the hope that a steady supply of wheat from official stocks at fixed price should bring some relief to consumers.

“We have more than half a million tons of stocks,’’ he said to explain that the government intends to issue about 100,000 tons every month, of which the bulk — 50,000 to 55,000 tons — will go to Karachi mills.

“Our stocks are sufficient to meet next four to five months demand. We have asked federal government for supply of 300,000 tons additional supply from Passco,” he said and was confident that there was no reason why Islamabad should not oblige Karachi as it had been doing so for years.

The advisor sees no problem in supplies or price-hike in the next six months because the government has enough stocks and will be carrying some quantity when the next crop will be harvested in coming spring.

Mr Jatoi blamed the federal government for creating wheat and wheat flour crisis in the market by making a premature decision to export even before the strategic reserves are built up and official procurement of five million tons plus is achieved.

“We lodged a strong protest with Islamabad on this premature decision of wheat export before completion of procurement,’’ he said and complained that it affected the procurement programme.

“There is enough wheat with traders who are hoarding it,’’ he conceded and disclosed that the federal government had asked about two months before to prepare a list of all such hoarders. “We have such a list with us,’’ he said, but refused to share any information on the plea that now the government is releasing wheat from its official stocks to bring down prices in the market, and hoarding had become an irrelevant and useless exercise.