THE decision to raise flour prices should be seen as both a motivation and an opportunity, says Tobago House of Assembly (THA) Chief Secretary Farley Augustine.
Last Wednesday, NFM announced that from January 3, the wholesale price of flour would increase between 15 and 22 per cent and suggested a 19 per cent increase in the retail price. Less than 24 hours later, Nutrimix – the country’s second-largest flour provider announced an increase of up to 20 per cent on its products.
In Trinidad, a 10kg sack of NFM Ibis flour is sold for $65 at most supermarkets. Owing to additional shipping and transportation costs, the same sack of flour retails in Tobago at around $74.
With the wholesale prices increasing, Tobagonians will have to dip further in their pockets for flour and flour products.
In an interview with Newsday on Tuesday, Augustine expressed optimism that NFM's price hike would not be a burden on Tobagonians. He said under the new administration, the island will become the largest producer of alternative flours in the Caribbean.
“We should see this as both an incentive and an opportunity to return to eating local. Ground provisions are by nature better sources of carbohydrates.”
Augustine criticised the previous PNM administration for the defunct Tobago Cassava Products Company Ltd not achieving its goals. The company was one of three special purpose companies subsumed in 2020 by the Tobago Agri-Business Company Ltd.
“Unfortunately, the former THA regime wasted time and resources and never properly executed the mandate with the cassava company. Other root crops like dasheen have also suffered under poor management and lack of policy to drive the industry locally. However, we are pushing to have the processing plant being built in Goldsborough to be completed within this first quarter of 2022. Tobago under our watch will become the largest producer of alternative flours in the Caribbean. We should see opportunity out of all of this.”
In November last year, former chief secretary Ancil Dennis distributed state lands to farmers as part of a $50 million farmland development initiative to boost agriculture on the island. Other incentives had been offered to get farmers to produce more.
Augustine said he sat in a meeting recently with the Division of Food Security, Natural Resources, the Environment and Sustainable Development and there are some plans in the pipeline.
“We are planning for a significant increase in support for the agro-processing sector and that includes ventures into the processing of alternative flours.”
He said while he has not had any conversations with NFM, Nutrimix or even the Ministry of Trade and Industry, TT can do nothing about the price of wheat.
“We don’t grow wheat here. We have to buy it at whatever the global market price is.”
He said a colleague reminded him of the market forces that are driving up the prices, noting that in the first instance, wheat prices on the futures market are up 25 per cent. He said wheat stocks in storage are down to 583 million bushels, the lowest since the 2007 to 2008 market.
“Thirdly, China with approximately 20 per cent of the world's population has aggressively bought about 50 per cent of the world supply, driving prices upward.
"Fourthly, volatile change has caused less wheat to be planted, stymieing the supply.”
The consumption rate of wheat currently, he said is higher than the current production rate.
He said geopolitics involving US, China, Taiwan, Russia, Ukraine and Hungary could affect wheat prices as well.