LAHORE: The Progressive Group of flour millers has criticised the government’s inconsistent wheat policies over the past three years, saying frequent policy reversals have created uncertainty for farmers, flour millers and consumers while undermining national food security.
In a policy proposal submitted to the government by Majid Abdullah and Khaleeque Arshad, the group said the deregulation of public-sector wheat trade in 2024, reportedly under pressure from international donors, was not accompanied by a clear transition mechanism or adequate consultation with stakeholders.
The group also expressed serious concern over reports that the government intends to procure 2.5 million tonnes of wheat during the current season at Rs 4,500 per 40 kilogrammes through commodity financing using its own financial resources. It said the proposed intervention would mark a major reversal of the 2024 deregulation policy and raise questions about the government’s policy direction and commitments to international donors opposed to a return to public-sector procurement and wheat subsidies.
The government had withdrawn from major areas of the wheat trade as in 2024; the food department abruptly withdrew from wheat procurement ahead of the harvesting season without taking key stakeholders into confidence. The absence of a major institutional buyer led to a sharp decline in wheat prices, exposing farmers to market fluctuations and financial losses, the Group claimed.
In 2025, the government encouraged flour mills to procure larger quantities of wheat to facilitate growers. However, after mills completed procurement, the food department imposed a maximum retail price of Rs 3,000 per 40 kilogrammes for flour. The intervention distorted market economics and reportedly caused losses worth billions of rupees, undermining confidence in private-sector procurement, the proposal alleged.
The group also criticised the classification of flour mills into functional and non-functional categories, saying it created discrimination and mistrust among industry stakeholders. In 2026, the government introduced another procurement arrangement through appointed aggregators, initially announcing an indicative wheat price of Rs 3,500 per 40 kilogrammes. However, the financial arrangements required to support the mechanism failed to materialize after banks reportedly withdrew shortly before the procurement season. Consequently, less than 500,000 tonnes were reportedly procured through government-appointed aggregators.
The group questioned whether the government had reassessed the financial implications, secured sustainable funding and consulted relevant international stakeholders before considering the move. It warned that another abrupt shift towards government procurement, without a comprehensive and transparent framework, could further destabilise the market and discourage private-sector participation.
It maintained that the central issue was not deregulation or government procurement in isolation, but the absence of a consistent, predictable and comprehensive wheat policy. Farmers, millers and consumers, it said, continued to bear the cost of decisions driven by changing political and economic considerations.
Describing wheat as a strategic food-security commodity linked to millions of farmers’ livelihoods, the group called on the government to make a clear choice between comprehensive regulation and complete deregulation.
Under a regulated framework, the government should introduce transparent procurement arrangements, a sustainable pricing mechanism and safeguards for all stakeholders. Alternatively, if it opts for deregulation, the private sector should be allowed to operate without arbitrary interventions, retrospective price controls or selective policy decisions.
The group stressed that the government could not encourage private-sector investment and procurement while retaining the authority to impose unpredictable restrictions after businesses had committed their resources. It urged the authorities to formulate a long-term, stakeholder-driven wheat policy ensuring fair returns to farmers, commercial viability for flour mills and affordable flour for consumers, warning that national food security could not be ensured through repeated policy experiments and sudden reversals.
Copyright Business Recorder, 2026