– Prashad to negotiate with bakers
Managing Director of the National Milling Company (NAMILCO) Bert Sukhai has announced that the price of flour will decrease from today, as a consequence of falling wheat prices on the international market.
This decrease is expected to lead to a reduction in the price of bread and other flour-related products, he told members of the media yesterday at a press conference held at the company’s headquarters in Agricola.
Meanwhile, Commerce Minister Manniram Prashad yesterday afternoon held another press conference where he saluted NAMILCO on this initiative, although he said that he felt it was long overdue. The minister is expected to meet local bakers today to negotiate a reduction in all flour-based products.
Rising international wheat prices during the second half of 2007 and early this year saw flour prices being increased locally in May of this year. However, an intervention by President Bharrat Jagdeo saw subsidy being provided on bakers’ and packet flour until September 5.
According to Sukhai, most bakers will benefit from a reduction of $1,280 on a 45kg bag of flour. This reduction represents a 17% decrease on the prices that were set on May 5 of this year. Consumers are also expected to benefit from a $20 reduction per kg on the Thunderbolt packet flour. A 1kg packet of Thunderbolt flour will now be sold at $165, compared to the previous price of $185.
The company was able to reduce prices after sourcing a shipment of 6,600 tonnes of wheat from Canada. This shipment arrived in the country on Monday night. According to Sukhai, NAMILCO has a Commodity Purchasing Department, which monitors the price of wheat on a regular basis and which determines when it is the best time to buy and from which source. He said that in most cases, NAMILCO purchased wheat from Canadian or American companies.
Sukhai said the decision to reduce prices was done with the interest of the consumer at heart. He stated that generally in Guyana, when prices increase there are consequential increases that are passed down to the consumers but when prices decline, the reverse seldom happens.
He explained that it took some time for the decrease in prices to come, because purchasing of “wheat involved a lot of logistics”. He said that his company brings in six shipments per year and only made purchases when required. And consequently, the most recent shipment from Canada has allowed it to reduce the price.
He added that the company, in its bid to ensure that consumers benefit from these reductions, will be going out and selling flour on a retail basis to customers.
Meanwhile when Stabroek News contacted a senior management officer at Graham’s Bakery about the expected decrease in prices, he said that he was unaware of it. The official, who gave his name only as Mr Dennison, welcomed the reduction, and added that it came after weeks of promises made by NAMILCO. He, however, had concerns about the permanence of these reductions, saying that the prices on the international market are very unpredictable these days.
Dennison did say that if the reduction in flour price was for an extended period, most likely the price of bread and other flour products will decrease.
When this official’s concern was raised with Prashad, he said the government is expecting an even greater reduction in the price of wheat, since the price of this commodity on the international market continued to fall.
