LAHORE: Punjab has introduced an innovative initiative to arrest the rising trend in flour prices, managing a drop of over Rs500 per 20kg flour bag in the market.
After receiving a tip-off about the transportation of huge quantities of hoarded wheat, the provincial food department has initiated a campaign to confiscate undeclared stocks and sell them to flour mills in the area at Rs3,900 per 40 kg, against the inflated market price of Rs4,800. The initiative launched under the provisions of Punjab Prevention of Speculation in Essential Commodities Act, 2021, proved hugely successful as it brought down the price of flour by over Rs500 per standard 20kg bag.
“We have started from district Okara, where the first illegally kept stock was recovered, and will extend this practice to other districts of the province gradually,” an official told The News on Tuesday.
As a result of the intervention made by the provincial government, a 10-kg flour bag is now being sold at Rs1,158 against the open market rate of Rs1,400 plus.
Progressive flour millers have welcomed the move, describing it as a good step towards providing relief to masses. However, a senior flour miller said that all flour mills should be given a fair opportunity to get wheat at such a discounted rate.
A letter written by the Food Department to all field formations communicated to launch action against speculation and hoarding of wheat in the province. Referring to reports of hoarding of wheat, it is noted that black-marketing of grains is jacking up the price of wheat, resulting in an escalation of the price of flour.
According to the official assessment, the price of a 20-kg flour bag has touched Rs2,750, while that of a 10-kg bag hit the Rs1,375 mark.
It said: “Such hoarding is in violation of the provisions of The Punjab Prevention of Speculation in Essential Commodities Act, 2021, and The Punjab Foodstuffs (Control) Act, 1958.”
“Hence, divisional, district, and field staff have been directed to take remedial actions on an urgent basis. Under the plan, it is stated that wheat hoarded in violation of The Punjab Prevention of Speculation in Essential Commodities Act, 2021, will be seized and sold under Section 7 of the said Act at the current notified price of Rs3,900 per 40 kg, and its proceeds will be deposited in the treasury. Criminal proceedings may also be instituted against hoarders, stockists and speculators.”
The letter said: “Flour manufactured from such wheat shall be sold at the maximum retail price of Rs1,158/10kg as per grinding charges approved by the Caretaker Cabinet in its 10th meeting held on March 13, 2023. An extraction ratio of 70:30 shall be ensured, and a record of the sale of flour to the customers should be maintained. The sale should be preferably made in the localities from where the seizure of wheat is made.”
The official correspondence made it clear that the objective of this campaign is to discourage hoarding and speculation in wheat. Hence, stocks illegally hidden or stored at rice mills, factories, godowns, stores, etc. should be unearthed, seized and sold under the said law.
However, the trading of wheat in grain markets (Ghala Mandis) should be encouraged. Moreover, wheat being transported under the valid purchase document of the flour mills should be facilitated.