Flour mills face wheat shortage, prices up 30-35 pc

Chandigarh: Despite record procurement of wheat from Punjab and Haryana this year, flour mills and biscuit makers in both the agrarian states are facing severe shortage of the crop, which has led to 30-35 per cent jump in prices of wheat-based products in the last one month.

Saying that Central government failed in "assessing" severe shortage of wheat in the market, flour mill owners asked the government to enhance the supply of wheat in these states and keep a check on hoarders exploiting the situation.

"We do not have wheat in the market to procure in spite of the fact that Punjab is one of the largest producers of wheat in the country," Punjab Roller Flour Mill Association President Naresh Ghai told PTI.

"Because of the opening of wheat export, wheat purchase from Uttar Pradesh and Rajasthan has also shrunk considerably," Ghai rued.

Flour mills claimed that because of non-availability of wheat in the market, most of the mills are now on the verge of closure. In Punjab and Haryana, there are about 130 flour mills, which have requirement of 1.70 lakh tonne of wheat per month.

Shortage of wheat has also fuelled the prices of wheat- based products, like wheat flour, to rise by Rs 3-4 per kg in last one month.

"Prices of wheat flour and other products like maida will further go up if Centre did not intervene and take corrective measures to enhance wheat supply as FCI has bulk of wheat in its godowns," Ghai said.

Echoing similar sentiments, Ludhiana-based Kitty brand bread maker Ramesh Mago said prices of biscuits and bread would also jump soon in the wake of big gap between demand and supply of wheat.

According to traders, wheat price has shot up by 35 per cent in last one and half month to reach a mark of about Rs 1,600 per quintal.

"The Central government has failed in seeing the wheat situation that has led to shortage in the market," Ghai said. The supply of 1.65 lakh tonne of wheat by FCI under Open Market Sales Scheme (OMSS) for July, August and September was exhausted in the first month itself, according to traders.

"The small flour mills could not get wheat under OMSS as big traders managed to buy wheat in anticipation of high rate due to its export," Haryana Flour Mills Association President C P Gupta said. Problem for flour mills has also compounded as they did not procure enough wheat when crop procurement was going on for Rabi Marketing season this year.

Punjab and Haryana saw record procurement of wheat at 129 lakh tonne and 86.69 lakh tonnes, respectively, while private traders bought just 2,000 and 1,000 tonnes of crop in both the states.

"The Centre should release wheat in sufficient quantity in Punjab and Haryana so customers could get wheat based products at low rates and we can run our mills" said Ghai.