Flour millers urge long-term policy, highlight industry challenges

LAHORE: Flour millers in Punjab have urged the government to formulate a long-term policy that fosters a sustainable environment for both the flour milling industry and wheat growers.

They called for the implementation of a free trade mechanism in the wheat and flour market, rather than short-term support packages. The demand was raised during a joint press conference at the Pakistan Flour Mills Association (PFMA) office on Friday.

The session was attended by PFMA representatives, Special Assistant to the Chief Minister on Food Salma Butt, and other senior government officials.

PFMA Central Chairman Asim Raza Ahmad highlighted the financial difficulties currently faced by the industry. He stated while the government last year encouraged mills to purchase wheat at Rs 3,900 per maund, most mills were only able to procure it at rates between Rs 3,300 and Rs 3,400 per maund. Despite the lower purchase price, he claimed that many mills still incurred heavy losses.

He further pointed out that banks are currently reluctant to issue loans to flour mills, pushing nearly 50% of them toward bankruptcy. Salma Butt addressed the concerns, stating that the government recognizes the vital role of traders, industrialists, and businesspeople in strengthening the economy. “No business entity is a mafia. They are all contributors to national development,” she emphasized.

She outlined several measures taken by the provincial government to support the agriculture and food sectors. Rs 15 billion fund has been announced to directly assist wheat growers, offering Rs 1,000 per acre in support. Farmers will be able to store wheat for up to four months, with banks providing loans covering 70% of the value of stored grain.

Butt also noted that the wheat supply has increased, causing market prices to decline.

In response, the government has lifted inter-district and inter-provincial movement bans on wheat and has committed to preventing any increase in the price of roti. As a result, the price of a 20kg flour bag has dropped from Rs 2,700 to Rs 1,600 in Punjab, which has in turn helped reduce flour prices in Khyber Pakhtunkhwa, where the same bag previously sold for Rs 3,200.

She clarified that the government had not taken any bank loans for wheat procurement this season, easing the financial burden. “Currently, the government’s wheat-related debt stands at just Rs 14 billion,” she said, adding that official wheat stocks now stand at 900,000 metric tons - considered a positive indicator for the province.

The government has also directed flour mills to maintain a reserve stock equal to 25% of their grinding capacity. Concluding her remarks, Salma Butt reiterated the government’s commitment to curbing inflation and ensuring affordable food for the public.

Copyright Business Recorder, 2025