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Loadshedding woes: Mills warn of flour shortage, price spiral in days to come

Loadshedding woes: Mills warn of flour shortage, price spiral in days to come

LAHORE: With 14-hour loadshedding reducing the wheat grinding, millers fear drying up of the pipeline within the next one week or so which in turn will make flour more expensive.

The millers claimed on Friday that major brands, which hold overwhelming share of the market, had already cut their supplies to half due to long and gruelling absence of power. The government may not be feeling the impact right now because it normally takes 10 to 15 days for the pipeline to dry up.

“But the cut in supplies has already started impacting the market and people may slowly feel it,” said Asim Raza of the Pakistan Flour Mills Association (PFMA). In view of the situation, the association is demanding exemption from, or at least reduction in, loadshedding for flour mills in Punjab. “People are not feeling the impact so far for two reasons: these are normally low-consumption months and it takes a while for the pipeline to dry up. Low consumption time in a sense that abundant wheat supplies are available in the market and rural areas are not heavily dependent on city grinding. But it does not mean that cities’ supplies have not started to dry up. Secondly, sufficient pre-Ramazan flour is still making up for the fresh loss suffered by the millers because of loadshedding. But the impact is already there and it would only worsen in the next week or so. The mills are facing 14-hour power suspension – four-hour normal loadshedding during the day and 10-hour outages at night due to Ramazan schedule and it has turned the grinding schedule, especially of major brands, upside down,” he explained and demanded that the government reduce loadshedding for the flour mills to ensure its uninterrupted supply.

“If it takes 15 days for the pipeline to dry up, it takes many days to retrieve the situation,” said Majid Abdullah, one of the holders of a major flour brand. “That precisely is our worry. These mills need 24-hour operation to keep market flowing. We, along with some other major brands, have cut our supplies to half because of power issues. It could make second half of the holy month difficult with flour shortage which could also make it more expensive. The major brands don’t participate in Ramazan package (grinding of low-priced official wheat) because their own consumer base is big enough to keep them busy 24 hours a day.

“With massive loadshedding, that consumer base now runs the risk of short supplies and paying extra amount. It worries everyone, the millers included. That is why now the millers want exemption from, or reduction in, loadshedding so that flour supplies to the market remain normal. Otherwise, continued disruption could make 20 fasting days more problematic,” he warned.

Published in Dawn, June 11th, 2016

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