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NFM offices on Wrightson Road, Port of Spain.
JOEL JULIEN

The price of flour is expected to rise from Monday January 3rd, 2022, the National Flour Mills has announced.

“With the increasing cost of wheat and freight globally, National Flour Mills today announced its decision to increase the wholesale price of flour by between 15 per cent and 22 per cent, with a suggested increase averaging 19 per cent on the retail price of flour to the consumer,” NFM stated.

NFM said this decision follows several internal initiatives to improve operating efficiency and reduce processing costs in an attempt to contain expenditure and maintain the price of flour, in the face of increased supply chain costs and soaring commodity prices.

Flour prices were last adjusted in 2008.

Commenting on the decision, NFM CEO Ian Mitchell said:

“This was by no means an easy decision, as we did everything within our control to try to hold our prices; but with the staggering increases in raw material and shipping costs, we were left with no choice but to make the adjustment. We are acutely aware of the knock-on effect that an increase in the price of flour could have in the market, but we cannot sell a product for less than it costs to produce.”

NFM chairman Nigel Romano said:

“It’s an unfortunate analogy, especially given the realities of climate change, but we have been confronted by the perfect storm –– 2020 witnessed the lowest wheat yields since 2007, and the supply chain disruptions caused by the pandemic have increased freight costs significantly, further impacting the landed cost of all grain and other material inputs.  NFM is a price taker.  We have no control over the landed costs of our imported raw materials, which now account for 64 per cent of our production costs.  I think the team is doing a good job improving our internal processing and driving other costs down, especially during these trying times, and we will continue to find ways to continually improve.”

NFM says should international prices drop in the future, they may be able to pass on those gains to the consumer.  However, the company notes with the current price hike, consumers will see the cost of their basic basket of goods go up. 

“The direct impact, assuming use of four 2kg bags of flour per month, is estimated to be an increase of $10.00 for the typical family, for example, an increase from $12.50 to $15.00 on a 2kg bag of Ibis,” NFM explained.

The company also notes that things made with flour, like doubles and roti, should not immediately become more expensive right away, stating:

“While flour is the main ingredient in a range of food items, it is not the only one, so an average increase of 19% in the price of flour should not necessarily translate into a 19% increase in the price of everything that contains flour.”