Sharp hike: Price of flour shoots up in city

Possible millers strike in Punjab against 7% levy to affect markets in K-P


Riaz Ahmad July 16, 2015
Possible millers strike in Punjab against 7% levy to affect markets in K-P. PHOTO: AFP/FILE

PESHAWAR: The price of flour has increased by Rs30 per 20 kilogramme bag in the wholesale market while the retail price is Rs780 per bag in the city.

Speaking to The Express Tribune on Thursday, dealers at New Rampura grains market said flour prices increased to Rs750 in the wholesale market. Although the retail price currently stand at Rs780 per bag, many dealers fear this will increase to Rs800 or Rs850 if millers based in Punjab go on strike after Eid against the 7% sales levy.

According to Food Grain Dealers Association President Haji Rambel, there is a strong likelihood that if millers go on strike in Punjab after Eid, it would deal a critical blow to the markets in Khyber-Pakhtunkhwa.

Chain reaction

“Over the past 14 years, the K-P government has reduced its wheat subsidy by 90%,” said Rambel.

According to the association’s president, this has made dealers entirely dependent on flour mills in Punjab to provide the commodity to them at open market rates. “At least 98% of flour in the city comes from Punjab,” he said.

In Punjab, the food department provides wheat to mills at heavily subsidised rates. However, the mills cannot provide this supply to K-P and have to buy it at higher prices from the open market to meet K-P’s demands.  “We are heavily dependent on Punjab for wheat which is on the open market.”

Rambel added, “A shortage of wheat on the open market will result in higher prices and restrict supplies to markets in K-P.” However, he added, this year third parties purchased wheat and stockpiled, creating an artificial shortage of wheat on the open market.

Published in The Express Tribune, July 17th, 2015.

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