LAHORE - The Pakistan Flour Mills Association (PFMA) has announced to increase flour price by Rs20 per 20kg bag to Rs740 from Rs710. The rate of high quality flour has been increased by Rs50 per 20kg bag. However, it is important to note that even after the raise in price the flour was still being sold below the officially notified price of Rs770 per 20kg.

The PFMA office-bearers said the increase in price was because of the rising wheat prices in the market. In the last one month, price has increased by Rs30 per 40 kilo, forcing the millers to pass a part of it onto consumers,” they said.

They claimed that the hike would not affect commoners and would be absorbed by the dealers, as the retailers always sell the commodity at higher rates. They said the dealers had been selling flour at officially notified prices and the rates only went down at the mill’s level. This increase thus would only squeeze dealers’ margin.

Pakistan Flour Mills Association Former Chairman Dr Bilal Sufi expressed his deep concern over rising prices of wheat only in Pakistan, damaging the flour milling industry severely. Dr Sufi said that in 2006 wheat price in Pakistan was Rs 415 per 40 kg and at that time international price was equal to Rs500 per 40 kg and over a period of 10 years now in 2016 the wheat price in Pakistan is Rs1350/per 40 kg.

The wheat price has registered a sharp increase of more than 300 percent in last ten years from Rs400 per 40kg to Rs1350 per 40kg, registering a jump of over Rs2,300/40kg. Presently, the wheat rate in Pakistan is highest in the world as staple food is available at Rs900 per 40 kg in the world market—more than Rs400 costly as compared to the world market.

According to experts, one of the key reasons for the food-inflation remains the government’s decision to increase the wheat support price by more than 300 per cent in last 10 years that indeed benefited big landowners, but proved a blow for the majority of people, especially belonging to the poor and fixed income groups. They said that huge rise in wheat support price has increased flour price by mounting speculative pressure on price that has already gotten close to alarming proportion for a majority of population. They said that hike in price has worked as incentive for hoarding, making flour market even more volatile.

Economists and financial experts have also questioned the past government’s criminal move of pushing the wheat support price to Rs1200 per 40 kilogram from 425 rupees in the early 2008. They said that during last 5 years atta rate has been increased by almost Rs500 and wheat’s rate by Rs800 per 40kg which is a huge burden on helpless consumers.