Global Rice News

The struggle to manage high utility bills continues for consumers, who are not seeing any significant price relief despite factors such as a drop in world prices of raw materials and edible items, the recovery of the rupee against the dollar, and low transportation costs.

Manufacturers and retailers share the blame for not passing on the lower cost of production to consumers. Retailers are particularly responsible for selling items at old higher prices, especially when it comes to pulses and wheat flour.

To address this issue, the federal government has focused on tackling sugar and wheat mafias, hoarders, and speculators to prevent smuggling to neighboring countries. These efforts have resulted in a decrease in the price of sugar to Rs130-150 per kg from over Rs200 a month ago.

Consumers expected a similar decrease in the price of wheat and flour after the crackdown, but it did not materialize. The import of wheat by the private sector and a good local wheat crop in March and April did little to alleviate the situation.

According to data from the Pakistan Bureau of Statistics, the import of wheat dropped to 556,903 tonnes from 1.099 million tonnes in the same period last fiscal year. The average per tonne (APT) price also decreased to $299 from $418. The rise in the value of the rupee against the dollar further reduced the landed cost of imported grain.

Despite these factors, the prices of wheat flour have shown no major downward trend, as seen in data from the Sensitive Price Indicator (SPI). A 20kg bag of wheat flour was priced at Rs2,550-3,000 in the first week of July 2023 and currently stands at Rs2,600-2,986.

The rupee has recovered against the dollar, but manufacturers have not passed on the impact to consumers. This has allowed them to consider raising prices as the dollar gains lost ground.

Transportation costs have also decreased due to the decline in high-speed diesel (HSD) rates. However, manufacturers have not provided any benefit to consumers already dealing with inflation.

The introduction of imported wheat by the private sector has helped manage the demand and supply gap according to Chairman of the Pakistan Flour Mills Association (PFMA) Aamir Abdullah. However, retailers have been reluctant to reduce prices proportionally.

Pakistan has seen an increase in pulses imports, which reached 518,119 tonnes compared to 454,851 tonnes in the same period last year. Despite the drop in average per tonne (APT) price to $620 from $766, consumers are still paying higher prices for various pulses.

The retail levels lack proper checks and balances, allowing retailers to maintain inflated prices despite fluctuations in wholesale prices. Additionally, retailers often charge extra on products without price tags to cover high power bills.

The rising export of rice has also contributed to its price increase. Non-basmati rice exports have surged, thanks to a ban imposed by India on non-basmati rice in July 2023, which opened up new avenues for local rice export.

Exports of meat and meat preparations have also increased. However, butchers blame higher exports for causing a hike in red meat prices.

In conclusion, consumers are still facing high prices despite favorable factors such as a drop in world prices, the recovery of the rupee, and low transportation costs. Manufacturers and retailers share the responsibility for not passing on the benefits to consumers. The government’s efforts to tackle mafias and speculators have had some positive impact on sugar prices, but more needs to be done to address the overall situation.

Source: [Dawn](https://www.dawn.com){:target=”_blank” rel=”nofollow”}