Flour industry sees better year

The flour industry is expected to bounce back next year after a difficult 2008 wherein prices became unstable as a result of the sharp increases in oil prices.

“We expect 2009 to be a better year. All market indications point to a positive outlook,” Ric M. Pinca, executive director of the Flour Millers Association (PAFMIL) told The Star in an interview.

According to Pinca, production of flour dropped to only 1.8 million metric tons in 2008 when compared to the two million metric tons recorded the previous year.

“We will recover lost ground next year. For sure we will post growth,” he added.

Pinca said that for 2009, production will be back to two million metric ton.

The reason, he said is the decision of the government to lift the tariff on wheat and the good harvest from Australia and the United States.

With regards to the tariff, Pinca said they hope the government makes the zero tariff permanent.

“We need a lot of cooperation from everybody to make it permanent so that the consumers can benefit,” Pinca said,

Meanwhile, bakers said they will be able to roll back the price of pan de sal to P1 a piece

“We are thinking of producing a smaller pan de sal for P1,” Simplicio P. Umali, Jr., president of the Philippine Baking Industry Group Inc said.

According to Umali, the smaller pan de sal will weigh only 20 grams. A normal pan de sal, priced at almost P3 per piece weighs 30 to 35 grams.

He said they will do this to make bread more affordable to more people. He said the low priced pan de sal will either be available late this year or early next year.

In addition to this, Umali said they will be implementing more roll backs on the price of bread starting January.

Currently, the price of 600 gram loaf bread is at P54.50 while a 250 gram 10 pack pan de sal is sold at P29.25 per pack.

 The price of loaf bread is expected to go down by P8 and pan de sal by P4 more if flour millers will follow the global trend and reduce the price of flour to P600 per sack from the current selling price of P900 per sack.