Wheat and Flour Prices Experience Significant Increase in Lahore

The cost of wheat and flour has seen a considerable rise recently in Lahore. Wheat prices have jumped by Rs300 this week alone, reaching Rs3,100 per maund (40kg).

This increase follows a month-long pattern of rising prices, during which wheat increased by nearly Rs1,000 per 40kg, and a 20kg bag of flour increased by approximately Rs500. These sharp increases have sparked worries about possible market manipulation.

Government Oversight Questioned

Critics suggest that the provincial government’s sudden choice to stop regulating the wheat market without warning has fostered an environment that encourages price manipulation. It is believed that this regulatory void has enabled wheat hoarders to artificially inflate prices, worsening the situation.

PFMA Chairman’s Concerns

Asim Raza, the Chairman of the Pakistan Flour Mills Association (PFMA), stated that the government has struggled to manage wheat prices effectively. Raza cautioned that the current surge in wheat prices is anticipated to cause a corresponding increase in flour prices shortly.

The association is actively examining the issue to gain a deeper understanding of its underlying causes and potential effects on the market.

Market Dynamics and Reserve Levels

According to market insiders, the current situation highlights the intricate relationship between government policies, market dynamics, and price fluctuations in the wheat and flour industries.

Khaliq Arshad, Chairman of the Progressive Flour Millers Group (PFMG), cautioned that the country’s limited wheat reserves could be a primary factor in the rising price trend. He pointed out that Punjab’s estimated reserves of over 2.5 million tonnes, held by both the public and private sectors, are insufficient to meet demand until April 2026.

Arshad suggested that wheat and flour prices may continue to climb if authorities fail to implement corrective actions. The upward trend in grain prices prompted traders to release stored wheat into the open market, causing the wheat price to decrease from Rs3,250 to Rs3,100 per 40kg.

Call for Government Action

Arshad emphasized the importance of a proactive strategy by both the federal and provincial governments to supplement wheat stocks and satisfy domestic demand before the next harvesting season. He warned that importing wheat may be unavoidable given the current and evolving circumstances.

Stakeholder Monitoring

PFMG President Majid Abdullah noted that stakeholders are carefully monitoring the situation, anticipating possible effects on the broader food market.

He revealed that the Punjab government’s notification setting a price ceiling of Rs2,900 per 40kg for wheat and Rs1,750 for flour in the retail market is no longer being enforced. Market dynamics are now influencing demand, supply, and prices.

Abdullah stressed that it is a simple matter of supply and demand, and if the government wants to maintain flour prices at a certain level, policy adjustments are needed to reflect current realities.

Efforts to reach Special Assistant to the CM for Price Control & Commodities Management Salma Butt for comment on the rising wheat and flour prices were unsuccessful.