Hard-pressed people dealt terrible blow as milk, flour rates upped in Karachi

• Commissioner notifies milk price at Rs180 per litre
• Flour rate goes up from Rs96 per kg to Rs104 per kg

KARACHI: Dealing a terrible blow to poor consumers, authorities and millers increased the rates of fresh milk and flour on Friday making things more difficult for families already struggling to make ends meet.

The Karachi commissioner on Friday issued a notification increasing the retail price of per litre milk to Rs180 from Rs170, which was fixed in the last week of October.

The flour mills on the other hand increased the rate of flour no2.5 from Rs96 per kg to Rs104 per kg while fine and super fine rate was increased from Rs105 per kg to Rs108.

Coming back to milk, dairy farmers and wholesalers raised the prices to Rs163 and Rs170 from Rs153 and Rs160 per litre, respectively.

Defending the increase, Media coordinator of Karachi Milk Retailers Association (KMRA) Waheed Gaddi said: “we have reminded several times to the commissioner that wholesalers never provide milk at control rate. As a result, the retailers are bound to sell milk more than the officially fixed price”.

He said that in the last October meeting, KMRA did not sign the notification as a protest.

Shakir Gujjar of Dairy and Cattle Farmers Association (DCFA) said that the notification was totally against the market reality as milk’s cost of production was Rs200 per litre while the dairy farmers’ price had been fixed at Rs163 per litre.

He urged the commissioner to review the prices as milk price should be fixed at Rs230 per litre after taking into account freight rates and profits of middlemen and retailers.

One of the leading manufacturers of tetra milk pack informed the retailers about an increase of Rs20 per litre pack to Rs240 effective from December 15, 2022. The 1.5 litre pack will cost Rs335 as compared to Rs310.

Retailers said after this price shock by FriesLandCampina Engro Pakistan, other companies might follow suit.

The companies never reveal the reasons for increasing the rates as they usually attributed the rising prices to soaring cost of production, the retailers added.

Flour prices

In November the flour mills had reduced the price of flour No2.5 to Rs96 per kilo from Rs110 per kg.

The price of fine and super fine flour was decreased from Rs125 per kg to Rs105.

The decision had been made due to a drop in wheat rate in the open market from Rs9,400 per 100kg bag to Rs8,300 after the start of release of grain to flour mills. The flour rate was fixed at Rs65 per kg by the Sindh government.

Millers get subsidised wheat at Rs5,825 per 100kg bag.

The recent increase has been made after a jump in wheat rates from Rs8,600 per 100kg bag to Rs9,200-9,300.

Chairman of Sindh Zone of Pakistan Flour Mills Association (PFMA) Aamir Abdullah said each mill was getting a fix quota of 10,000 wheat bags per month which was fixed in October.

“Mills now require more wheat due to higher consumption of flour in winter.”

He said millers were utilising 35 per cent of the Sindh government’s wheat in producing flour while lifting the rest of wheat from the open market at higher rates.

Mr Aamir added despite the increase in the rates, the flour rates were still cheaper than Punjab.

He said that the federal government was offering 500,000 tonnes of wheat to the Sindh government but the provincial government was considering taking 200,000-250,000 tonnes.

Pakistan has imported costlier wheat to bridge the demand and supply gap.

From July to October 2022, total wheat import stood at 1.1mn tonnes valuing $460mn as compared to 731,751 tonnes amounting to $235mn.

The average per tonne price of grain stood at $419 in 4MFY23 versus $321 in the same period last fiscal.

As per data of Pakistan Bureau of Statistics (PBS), Pakistan had spent $2.238 billion to import 6.466mn tonnes from July 2020 to October 2022.

On Dec 8, Sindh Food Minister Mukesh Kumar Chawla said that the Sindh government had 7.5mn tonnes of wheat in its stock and enough to supply flour to the people at subsidised rates till March 2023.

The Sindh government had set a target of procurement of 1.4mn tonnes of wheat in the current season, while it had procured one million tonnes from the local farmers, while 400,000 tonnes had been procured from Passco, out of which 200,000 tonnes had been delivered, the remaining 200,000 tonnes would be delivered by December 20.

He said that there was a fear of damage to the wheat in the areas affected by floods and rains, but thankfully, major stock of wheat remained safe. Only little damage has been reported.

He added that food department teams had checked warehouses in different areas and the damaged wheat had been separated.

Published in Dawn, December 17th, 2022