In the wake of duty withdrawal and its increase to Rs 20 per kilo gram a marginal increase in wheat flour prices of approximately Rs. 10 or less, Turkish wheat flour producers have been dumping flour into Sri Lanka at extremely low prices hurting the local producers, industry sources said.
The Government has taken steps by introducing a mechanism that makes it mandatory to obtain licenses for importing wheat flour.
Under this situation importers are reluctant to import wheat flour creating a shortage in the market and allowing Prima and Serendib companies to dominate the industry
The issue was further exacerbated when the Consumer Affairs Authority (CAA) carried out an extensive raid on 4 August.
The operation, believed to be the largest conducted by the Authority to date, uncovered wheat flour among other food items unfit for human consumption. Among these items, there were stocks of infested flour suspected to be of Turkish origin.
Sri Lankan consumers are fed with low-quality and rejected flour from Africa. Recently US Wheat Associates raised alarm bells over the dumping of cheap Turkish flour around the world to the tune of $ 100 to 500 per year.
It is a sad situation if Sri Lankan consumers are fed with low-quality and rejected flour from Africa. Flour importers urge the authorities to look into this immediately.
Sri Lanka’s flour market has long been a crucial component of its economy, with local suppliers always able to meet the demands of a growing population without the need for exports.
The country’s flour industry, which provides livelihoods for many and contributes significantly to the national economy, is now grappling with the implications of unfair trade practices.
Based on Sri Lanka Customs statistics, since January 2022, over 190,000 MT of Turkish flour has entered Sri Lanka’s market, raising concerns among local suppliers and authorities.
The influx has resulted in an outflow of approximately $ 100 million from the cash-strapped nation, a particularly alarming situation as the country grapples with the worst economic crisis in its history.
Additionally, allegations of dumping have sparked debates over the potential impacts on Sri Lanka’s flour industry.
These concerns span a wide range, from the losses faced by importers and exporters striving to remain competitive to the reduced production that could lead to job losses and decreased investment.
Moreover, it is worth noting that these practices do not benefit anyone, including consumers.
Recognising the implications, the Government has taken steps by introducing a mechanism that makes it mandatory to obtain licenses for importing wheat flour.
The measure was implemented with the aim of controlling the rise in the price of wheat flour in the market and preventing the influx of lower-priced sub-standard products.
The situation also underscores the critical importance of ensuring that imported food products meet the highest standards of quality, safety, and ethical practices.
