Flour demand up 10.5% this year

MANILA, Philippines - The demand for flour went up by 10.5 percent this year, the Philippine Association of Flour Millers (PAFMIL) said. 

In an interview with The STAR, PAFMIL executive director Ric M. Pinca said millers imported two million metric tons of flour this year compared to 1.92 million metric tons last year.

For 2010, Pinca said that they are targeting to import 2.2 million metric tons, the same level of importation in 2002.

Pinca said they expect the demand for versatile and mobile food to go up because of elections. “2010 is an election year so we expect greater expenditure for versatile and mobile food,” he said.

Given the projected steady supply of harvested wheat, Pinca said they do not expect any spikes in the price of flour. 

He said the only reason for flour prices to rise would be a sudden increase in the price of petroleum and drastic weather changes.

The Philippines is the fifth biggest importer of wheat from the United States. The biggest is Japan with 3.3 million metric tons, Nigeria with 2.7 million metric tons and Mexico with 2.6 million metric tons. 

The remainder of the country’s milling food wheat requirement was imported from Canada and Australia. Likewise, majority of the feed wheat is imported from Ukraine. The Philippines imports 1.1 million metric tons of feed wheat from Ukraine.

Earlier, flour millers said they are posing no objection if the government decides to bring back the tariff on milling wheat because the price of flour and flour related products have already stabilized.

“We believe that the one-year zero duty privilege granted to the wheat flour milling sector through two executive orders (EOs 765 and 818 ) is enough to stabilize the price of flour and flour-based products in the country,” Pinca said.

According to him, they are not going to ask for an extension of Executive Order 818 which allowed the duty free importation of milling wheat. Previously, the duty for milling wheat was three percent.

”At the same time, while the zero-duty import privilege tided us over during the period of high world wheat prices due to the shortage of the crop worldwide, world wheat supply and prices have since stabilized resulting in lower wheat import price,” Pinca added.

The wheat flour milling sector has reflected the zero tariff and lower wheat import prices in the cost of flour which has gone down by more than 20 percent since 2008.