Supply crunch push flour prices up by Tk5-10 per kg

Prices of flour, the second most important food staple in the country, have gone up by Tk 5-10 per kg in the retail market due to a supply and production shortage caused by the unavailability of wheat and a prolonged power crisis.

In the retail market, according to traders and consumers, loose atta or wheat flour sold at Tk 58-65 per kg in the capital’s kitchen markets on Tuesday, up from Tk 53-55 per kg a week ago. Packet atta sold at Tk 66-68 per kg on the day, up from Tk 58-62 per kg last week.

According to the Trading Corporation of Bangladesh, the average price of loose atta was Tk34 per kg in the same period last year, meaning an 81 per cent jump year-on-year.

Meanwhile, maida or refined flour was selling at Tk 75 per kg on Tuesday, up by Tk 5 from last week, while packet maida cost Tk 80-83 per kg.

Wholesalers, in the meantime, have warned that prices of atta-maida will further increase by Tk4 per kg in a day or two. 

Retail traders said they are not getting flour from wholesalers despite having placed orders and being willing to pay more than the usual prices, resulting in a price hike across kitchen markets in the capital.

“I have not received any supply of packet atta in the last one week despite placing orders. Wholesalers are not supplying atta even at higher prices,” said Mostafizur Rahman, a retailer of Segunbagicha kitchen market.

Another trader in the area, Abdur Rahim, echoed a similar experience.

He said, “Loose atta-maida are not available in the wholesale market. I bought two sacks of flour from the Moulvibazar wholesale market in the capital on Wednesday by paying extra.

“The wholesale price of atta is now Tk 60 per kg. I cannot sell below at Tk65 including other expenses.”

The fall in flour production in the local market is a direct result of a halt in wheat import, said mill owners, warning that production may stop altogether in the coming months if the import crisis is not resolved soon.

Also, they said the ongoing power crisis has more than halved their production capacity down.

Redwan Rahman, executive director of Bashundhara Foods and Beverages, a major producer of flour in the country, told The Business Post (TBP), “We started importing wheat from the Ukrainian market after a long time after India stopped supplying it, which has also stopped now.

“We have a production capacity of 3000 tonnes per day. But our production declined by 60 per cent to 1000-1200 tonnes.”

He said Bashundhara Foods is having to use up its stock of wheat until the import crisis is resolved, which has reduced their production capacity. In addition, the gas and electricity shortages are further exacerbating the problem.

Even before the latest problems, flour prices were already on the rise as a decrease in production upped the cost per unit, and an unstoppable strong dollar hiked import cost of wheat.