Wheat prices go up by Rs 400 per tonne

The Sindh government is contemplating imposing a ban on the interprovincial movement of wheat following a sharp increase in its prices by Rs 400 per tonne, sources said on Monday. Despite the bumper crop of 23.5 million tonnes in the country this year, wheat prices are on the rise in the local market.
Wheat prices stood at Rs 10,625 per tonne in the local market during the last week of April as compared to Rs 12,100 per tonne presently available in the local market. Some measures are on the cards, including punitive actions against the wheat through hoarders by raids on godowns, besides a ban on inter-provisional transportation of wheat grains, sources said.
"The Sindh food department has collected all details of wheat hoarders and in the first phase, it will impose a ban on its inter-provincial transportation and in the second phase, it will carry out raids on wheat godowns under the Food Stuff Control Order, 1953 Act," they added.
They said that if such move by government did help normalise the situation in the local market pertaining to wheat price control, the other option would be to raid such hoards possessed by the exporters and millers to curb the commodity price-hike.
According to data compiled by the Sindh food department, exporters and millers have stored around 0.15 million tonne wheat in various godowns in Karachi to raise its prices, they pointed out.
"Despite a government decision to suspend wheat export, there's no positive change in the local market, forcing the government to take immediate action against wheat hoarders," said sources close to the Sindh food department.
They said that banks have also financed around one million tonnes wheat, whereas individual financiers, including exporters and miller have hoarded wheat worth million of rupees in their private stores.
The Sindh food department is closely monitoring the local market and on Monday wheat prices have been raised once again by Rs 400 per tonne to Rs 12,100 per tonne as compared to Rs 11,700 per tonne last week in the local market, they said.
Sindh has also failed to meet its wheat procurement target by 130,000 tonnes due to high price in the local market, as it has procured around 570,000 tonnes of wheat against the target of 700,000 tonnes, sources said.
The federal government had given green signal to exporters by lifting a two-year ban on the wheat export last December, but in May 2007, the government suspended wheat export to control its soaring prices in the local market and meet wheat procurement target, they said. "The government is expecting that after the raid on stores, wheat would be available in the local market in abundance and the prices of the commodity, it is hoped, would decline by Rs 500-600 per tonne to it previous price level at Rs 11,500 per tonne," they said.