There will be no immediate increase in the price of flour. This was the assurance given by National Flour Mills (NFM) officials to Trade Minister Paula Gopee-Scoon during a meeting on Monday afternoon to discuss factors affecting a potential price increase.
During the approximately hour-long meeting with NFM’s chairman Nigel Romano and its CEO Kelvin Mahabir, Gopee-Scoon stressed the importance of controlling operating costs of flour production and other areas of business.
The minister also raised the issue of the pricing of the main types of wheat, which represents a major ingredient in the production of flour. NFM was urged to adopt procurement practices which beneficially hedged against increases in prices. The ministry, in a statement issued around 6 pm yesterday, added that Romano “informed the minister (NFM) will exhaust all available avenues to manage its operating costs and that any adjustment in prices will be an absolute last resort.”
Romano said the board and management have been working assiduously to develop strategies to diversify its revenues streams from its other product segments. Gopee-Scoon was told about several initiatives currently being undertaken by NFM to improve productivity, quality management, process efficiencies and employee welfare.
These include modifying the feed mill, automating plant systems, acquiring new equipment and machinery for the dry mix operation and employee training programmes. NFM committed to engage the Trade Ministry “more frequently on strategic matters and to continue collaboration with the Government in the export diversification thrust,” the ministry said. Last Wednesday, Mahabir was quoted in an interview as saying that if wheat prices maintain their upward trend, NFM would no longer be able to absorb the higher price of raw ingredients – wheat accounts for 60-65 per cent of the company’s total imports. NFM last raised prices in 2008.
NFM has also been paying more for transport since October, when Government reduced the diesel subsidy, as well as paying more to obtain US dollars, with which it pays for wheat imports.
Mahabir said an increase was something to be considered, and if not, there would be significant pressure on the company.
Hours after the article was published however, the ministry issued a strongly worded statement expressing disappointment at Mahabir’s comments.
This led to Monday’s face-to-face meeting between Gopee-Scoon and NFM officials.