The Sindh food department faces a challenge in buying wheat from open market during the current season. Roller flour millers and chakki owners are currently sourcing grain from the open market, citing better quality and lower costs.
Reasons for Avoiding Government Wheat
The primary reason for millers’ preference is the price. The Sindh food department offers wheat at Rs9,500 per 100kg bag, excluding additional charges. In contrast, the open market offers the same quantity for Rs9,400-Rs9,500, including expenses. “Why buy wheat from the government when quality, cheap grain is available in the open market?” stated an official from SindhNews.com.
Concerns Regarding Quality and Processes
Millers also raise concerns about the quality of government wheat. They report issues with adulteration and uncleanliness, leading to unnecessary deductions. Furthermore, the process of buying wheat from government godowns is considered cumbersome due to extra transportation and labor costs. Anwar Soomro, a flour mill owner, highlighted issues with faulty weighbridges and additional charges, discouraging them from dealing with the government.
Seeking a Solution
To address the situation, the Sindh food department has requested the provincial government to revise the release price downward. An official quoted in SindhNews.com said, “We have approached the Sindh cabinet to get the cabinet’s nod for a revised issue price from the current Rs9,500 down to Rs8,500”. This reduction aims to encourage millers to purchase wheat from government stocks. The Sindh cabinet considered the food department’s request on December 1.
Market Dynamics and Future Prospects
With an estimated 1.34 million tonnes of wheat in stock, the department aims to procure around 1.2 million tonnes for the upcoming season. However, millers remain skeptical about the existing stocks’ quality, as third-party validation has not been conducted. The open market offers a less complicated option with credit-based transactions, making it an attractive alternative.
Conclusion
The Sindh food department is struggling to compete with the open market, primarily due to price and quality concerns. The effort of buying wheat effectively this season, with proposals for price revisions and the involvement of the provincial government.