Prices seen falling after arrival of imported wheat
KARACHI: Stakeholders expect a Rs5-7 per kg decline in wheat prices after a private sector consortium finalised a deal for the import of 700,000 tonnes of Russian and Romanian wheat which would arrive in 12 cargo ships.
The first ship carrying 55,000 tonnes of Russian wheat would arrive at Karachi port on Sept 15. The second ship with 60,000 tonnes is expected to arrive in the third week of this month.
Cereal Association of Pakistan (CAP) Chairman Muzzamil Chappal told Dawn that the wheat is being imported from Russia and Romania in the price range of $282-295 per tonne (C&F) Karachi.
He said the landed price of imported wheat is estimated at Rs100 per kg and it may cost Rs105-106 at the market level. Imported wheat arrival would help in bringing down flour rates. The private sector is importing wheat without any government subsidy.
Consortium finalises deal for 700,000 tonnes of Russian, Romanian grain
Meanwhile, Pakistan Flour Mills Association (PFMA), Sindh Zone, Chairman Aamir Abdullah anticipates a drop of Rs5-7 per kg in wheat rates from the current rate of Rs120-123 per kg. “The price may start dropping from just a few days ahead of the arrival of the first Russian shipment,” he hoped.
On the contrary, Mr Chappal expected an immediate drop of Rs5-6 per kg and a further drop of Rs20-25 after the arrival of Russian wheat.
He said that importers and market traders on Wednesday held a Zoom meeting with the Ministry of Food Security and they were assured that the imports would be streamlined after the input taken from the private sector. However, the government had not given a clear stance regarding wheat import by the Trading Corporation of Pakistan (TCP).
The government had allowed the private sector to bring imported wheat till March 15, 2024, he claimed.
The CAP chairman was of the view that the TCP may also be allowed to import 500,000-700,000 tonnes of wheat.
Currently, the country is facing a shortfall of 2.45m tonnes as per demand, the market would need at least 3.5m tonnes of wheat in the current year.
As per the demand and supply gap, the government should allow the private sector to bring in 40-60 wheat-loaded ships. There is also a need to issue an SRO regarding permission for wheat imports to avert any issues in future, Mr Chappal said.
However, consumers did not benefit much from the import of 2.7m tonnes of wheat by the government costing $1 billion during FY23 compared to 2.2m tonnes amounting to $795m in FY22. As per the Economic Survey 2022-23, the country produced over 27mn tonnes of wheat.
The national average rate of 20 kg wheat flour is Rs2,600-2,800 as against Rs980-1,940 in the first week of July 2022.
Issues of wheat smuggling to Afghanistan, non-release of wheat by the provincial governments to the flour mills and procurement of grain by the millers from the open market at high rates remained in the limelight for which the consumers continued to pay high prices for various flour varieties.
Source Link: https://www.dawn.com/news/1774698/prices-seen-falling-after-arrival-of-imported-wheat
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