Govt to Import One Million Ton of Wheat, But Flour Gets Costlier

wheat flour

ISLAMABAD/LAHORE: The federal government has decided to import one million metric tonnes of wheat in an effort to control prices, but flour has become more expensive nonetheless.

Instead of falling, flour prices have risen further despite the import decision. While 11 items including tomatoes, chicken and onions became cheaper, documents from the Pakistan Bureau of Statistics have brought public difficulties into sharper focus.

The most expensive 20-kilogram bag of flour in the country was recorded in Karachi, where it reached Rs3,200. In Peshawar the price stood at Rs3,100, in Islamabad at Rs3,093 and in Rawalpindi at Rs3,067.

In Hyderabad the bag was recorded at Rs2,940, in Bannu at Rs2,900 and in Quetta at Rs2,850, while in Multan, Sialkot, Gujranwala and Sargodha the price ran up to Rs2,800.

The pressure of inflation, however, is not confined to flour. Twenty essential commodities became more expensive over the course of a single week. LPG rose by 3.46 percent, diesel by 2.44 percent and petrol by 1.71 percent, while quarterly electricity charges also increased by 2.06 percent.

The figures come from the Sensitive Price Indicator, the weekly inflation gauge compiled by the Pakistan Bureau of Statistics. The SPI tracks the prices of a basket of essential items across urban centres nationwide and is the most frequently published measure of cost-of-living movement in the country, functioning as an early signal of the direction that monthly consumer inflation is likely to take.

The gap between the import decision and the price outcome reflects the lag inherent in the process. A decision to import does not affect domestic supply until tenders are floated, contracts awarded, cargoes shipped and consignments cleared, milled and distributed — a sequence that typically spans several weeks at minimum. Prices in the interim continue to be set by existing stock positions and market expectations.

The regional spread in the data is itself informative. The highest recorded prices are in Karachi, Peshawar and the federal capital region, while the lowest sit in the Punjab wheat belt cities of Multan, Sialkot, Gujranwala and Sargodha. That pattern is consistent with proximity to production and the cost of moving grain and flour over distance, a differential that widens whenever transport costs rise.

Which is where the diesel figure becomes relevant. A 2.44 percent weekly increase in diesel feeds directly into the freight rates that carry wheat from procurement centres to mills and flour from mills to retail markets, adding to the delivered cost in precisely the cities that are furthest from the growing areas.

The wheat market has undergone substantial structural change in recent years, with the government stepping back from large-scale procurement and support-price intervention. That shift transferred a greater share of price determination to private millers, traders and market forces, reducing the state’s ability to influence retail prices directly through the release of public stocks.

The result is that the principal lever now available is import volume, which affects the total quantity available in the market rather than the price at any particular point in the chain.

Wheat flour carries the single heaviest weight in the household consumption basket for low-income families, which is why movements in the price of a 20-kilogram bag translate more immediately into perceived hardship than changes in almost any other commodity.

The simultaneous easing in tomatoes, chicken and onions offers limited offset, since those items are consumed in far smaller quantities by weight.

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