Minfal rejects wheat exporters' demand

A senior official of Minfal on Tuesday rejected wheat exporters' plea that if wheat export did not start according to government's earlier decision then they would have to pay heavy penalties after cancellation of their agreements with the importers.
It may be recalled that after bumper wheat crop this year, the government decided to export 0.5 million tonnes through the private sector. The private sector made commitments with importers, and later local traders started hoarding the commodity and domestic wheat prices shot up despite bumper crop. Consequently, the government had to withdraw its decision and suspended its idea to export wheat.
A local wheat trader requesting anonymity said that initially it was naïve decision to export wheat when the country did not have enough surplus. After taking buffer stock of one million tonne over and above the estimated consumption of 22.5 million tonne, there was hardly any surplus left for export.
After the government's decision to withdraw its decision, the private sector raised hue and cry that they (wheat exporters) will have to pay heavy fines as penalties due to breach of contract, if the government does not reverse its decision in favour of export.
When contacted, a senior official of Minfal said that the private sector is magnifying the issue and accusing that the government has undermined their market reputation.
The official said, "the exporters are giving fake statements as no exporter will have to pay a penny at all on the contracts made with the wheat importers".
Every exporter is blaming the government for not permitting wheat export. "When the prices of wheat and atta went up in the domestic market, the government was left with two options, first to allow wheat export to earn profit and the second, to suspend wheat export to control the price hike in the local market. The government decided on the second populist option", he added.
According to official wheat hoarding has led to artificial price hike in the local market. The private sector will have to bring the wheat stocks back to the market.
When Business Recorder talked to a wheat exporter, he said the government is not taking exporters seriously. He said that the government demanded the detail about our LCs with the claim that it would do something about the commitments made by the private sector but now it is blaming the private sector.