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Govt rejects millers’ demand, fixes wheat quota

January 04, 2013

KARACHI, Jan 4: Rejecting demands for the restoration of a liberal policy on wheat distribution among flour mills and chakki owners, the food department has decided to retain the quota system and issue 550 wheat bags per mill a day in order to ensure a smooth supply of flour to consumers at reduced rates.

The decision was announced by Shahnawaz Magsi, the Sindh food minister’s coordinator, at a press conference held at the food department on Friday.

Mr Magsi, who was accompanied by Food Secretary Aftab Ahmed Memon and Director Talib Magsi, also rejected reports and warnings about a looming flour crisis in Sindh, and said there was no wheat shortage and as such there was no possibility of a flour crisis.

He criticised ‘vested interests’ and flour millers for trying to create an ‘artificial wheat or flour crisis’ in the province by taking undue advantage of the liberal policy pursued by the government since Nov 19, 2012.

The coordinator rejected millers’ claim about a curtailed supply of wheat to flour mills and informed the media that the food department provided 1.2 million wheat bags to millers in Karachi last month under the liberal policy.

“Some 20 mills lifted a quantity around four times higher than their production capacity,” he said, accusing the mills of indulging in hoarding and trading.

The food department officials also presented to the media what they described as evidence of stockpiling by the mills.

They said the mills lifted a total of 586,000 wheat bags and were supposed to offer flour at Rs32 per kilo (ex-mill). “However, the mills raised the flour price to Rs36-37 per kilo,” they added.

The government had to do away with the liberal policy in view of misuse on the part of millers, the officials said.

“Now each mill will get 550 bags per day (or 12,000 bags per month) and will be bound to provide 96,000 (10-kg) flour bags at reduced rates,” they said, adding that the Sindh government had already fixed the issue price at Rs2,800 per 100-kg bag in November last year.

The officials said that the mills were not allowed to extract sooji (semolina) and maida (refined flour) from the government-supplied wheat.

Surprisingly, Pakistan Flour Mills Association (PFMA), Sindh Circle chairman Mumtaz Shaikh was also present at the press conference.

On Thursday, Sindh PFMA vice chairman Ilyas Kapadia and other millers strongly criticised the food department for providing only 300 bags per day to each mill as against its requirement of 1,100 bags per day.

The price of a 100-kg wheat-bag in the open market has already risen to Rs3,400 as against Rs2,600 prevailing since July 2012.

Millers have also raised the prices of various flour varieties by Rs125 per (a 50-kg) bag over the past 12 days.

PFMA Sindh chief Mr Shaikh said he was surprised to see his association’s vice chairman and other office-bearers holding a press conference without him (the chairman) and presenting a wrong picture by ‘twisting the facts and figures’.

He said he could not at this stage say whether action would taken against them but he categorically stated that there was no likelihood of a wheat or flour crisis in Karachi.

He claimed that the Sindh government possessed a stock of 7.3 million bags of wheat which was sufficient to meet the requirement until the arrival of the new wheat crop by the end of March.