Bakers ask DTI to make millers justify flour prices

Bakers on Friday have urged the Department of Trade and Industry (DTI) to make local flour millers explain the latest increase in prices of flour while international wheat prices are declining. The Philippine Baking Industry Group Inc. (PhilBaking) and the Federation of Bakers Association Inc. (FBAI) said in a statement that flour prices have risen by 11 percent despite a 10-percent drop in wheat prices in world markets. The bakers' groups said a DTI dialogue with the Philippine Association of Flour Millers (PAFMIL) and the Chamber of Philippine Flour Millers can clarify why prices of the commodity have risen. The call for government intervention comes after the same groups said the cost of branded loaf bread will soon rise. Citing US Wheat Associates data, the bakers said wheat was $476 per metric ton (MT) in June, down $50 from $526 in February. They added that flour in the Philippine market in June was P930 per 25 kilogram sack, up from P840. PhilBaking and FBAI said the dialogue can be the venue for flour millers to explain when they will reflect the recent decline in the cost of wheat. “We are all anticipating the overdue drop in the price of flour as according to the millers it takes three months for them to convert wheat into flour. It has been already four months and we are hoping prices will start to decline," said PhilBaking president Walter Co. The bakers asked government to intervene because costs are up but they are unable to raise prices. "Many bakers are incurring significant losses because of their inability to adjust bread prices because they are afraid that if they increase, it might lead to [a] drop in sales," the groups said. They also asked why flour from other countries in Southeast Asia cost less than locally-milled flour. “If other Asean countries can sell flour at only P800 even after all the additional shipping and handling costs, the local flour millers can likewise offer the same price because they have the same high quality of flour," PhilBaking director Jun Umali said. — ELR/VS, GMA News