Pakistan. Short wheat supply blamed for flour shortage, price hike

Flour millers hold reduced wheat supplies by the food department as one of the major reasons behind flour shortage and an increase in its price, which has gone up to Rs140 per kilogramme for the chakki variety.

Central chairman of the Pakistan Flour Mills Association, Asim Raza Ahmed, and Punjab Chairman Chaudhry Iftikhar Mattu say the only reason behind non-availability of flour and increase in its sale price in all the districts of Punjab, including Lahore, is a shortfall of 5,000 tonnes in wheat release quota for mills by the food department.

They say that instead of 26,000 tonnes, the department is releasing only 21,000 tonnes of grain daily from its stores in the province. That is the reason customers are seen standing in long queues to buy flour.

In a statement, they say the food department has surplus wheat, while at least 500,000 tonnes of imported wheat will reach the province by the end of January. But people are facing a shortage of the commodity because the department is not fulfilling the local requirement, as more flour is consumed during winters to meet energy needs.

LHC strikes down restriction on release of wheat from public stock to new mills

They say that fixing the Rs4,000 per 40kg grain support price by Sindh against Rs3,000 for the same weight by Punjab is also affecting the wheat market in the province, as the rate of the commodity has gone up to Rs4,300 per kg in the local markets. This has led to an increase in the price of 15kg flour bag here, they add.

This pressure in the open market, they say, will be reduced only through improved supplies of wheat, and the flour price will automatically come down for the benefit of the consumers.

Meanwhile, the Lahore High Court has struck down a restriction imposed by the food department and allowed the release of wheat from public stock to newly established flour mills possessing valid licences.

Justice Abid Hussain Chattha passed the order allowing several petitions filed by Rana Abdul Basit Khan and other flour mill owners challenging a notification by the food secretary issued on May 19.

The petitioners’ counsel contended that the mills applied for the release of wheat from public stock to the food department and due inspections were carried out for the verification of their installed machinery and grinding capacity.

However, the request of the petitioners for release of wheat from public stock was denied in view of a provision in clause-VII of the impugned notification.

Assistant Advocate General Barrister Lehrasip Hayat Dahar contended that the food department has the right to formulate policies and regulate the release of wheat from public stock in larger public interest. He said the rationale for incorporating the restriction in the notification is that the distribution policy can be kept stagnant and adhered to without any disruption and frequent changes.

He said the petitioners/mills were not barred from grinding the wheat after procuring it from the private sector and that they will become eligible for release of wheat from the public stock after the next harvest season.

The law officer argued that if every new entrant is extended the benefit of the policy, a new quota will be required after incorporating them, which is not only impractical, but will also hinder smooth and uninterrupted supply of wheat to the existing mills.

However, Justice Chattha observed that the restriction is unreasonable, arbitrary and capricious and not based on any intelligible criteria.

“It does not withstand the test of structured discretion and therefore… clause VII of the notification is struck down and is declared unconstitutional and unlawful,” he concluded.

Tags: prices, Pakistan, wheat, Flour