NAMILCO unaffected by wheat shortage but battles higher fuel, packaging costs
By Lazeena Yearwood
The National Milling Company of Guyana (NAMILCO) is not affected by the global wheat shortage but increasing fuel and packaging costs have contributed to the higher cost of flour, Operations Manager Ralf Hemsing has said.
“NAMILCO is in a more fortunate position than most other companies because we have level integration, we have our own wheat vessels, we have our own turning office.
“We have a very good logistic network. So far, we are not affected but there are obvious effects around the world by a [wheat] scarcity,” Hemsing told the News Room on Wednesday.
Supply chain disruptions stemming from the Russia/Ukraine war contributed to a global wheat shortage but Hemsing told the News Room that NAMILCO’s supply remains uninterrupted because it gets wheat from different sources.
NAMILCO’s wheat is imported from the United States (US) and Canada.
Evidencing the company’s position, Hemsing highlighted that some 8,000 tons of wheat are currently being unloaded in the country.
This shipment has been delivered even as the global wheat stock is currently at its lowest, the Operations Manager explained further.
Asked whether he anticipates a shortage of wheat in Guyana as the invasion continues, however, Hemsing said he could not make a definitive pronouncement.
“It’s something we really can’t foresee but with our logistic network, I don’t think we are going to be affected,” Hemsing said.
Even though its supply has been uninterrupted, NAMILCO, earlier this year, increased the price of its flour by 15 per cent.
Other associated costs of producing flour and other products have increased, however.
According to Hemsing, the cost of fuel and packaging materials is increasing. These directly impact the price of products.
It is possible for a reduction in prices, however.
“Later down the year, we don’t know what’s going to happen to prices but I think it’s already high and it will probably stabilise somewhere, where it is now for at least the next half [of the] year before it can have a chance to come down,” the manager said.
Reuters reported that Russia’s invasion of Ukraine led to a surge in global wheat prices. This invasion started in February and has not ceased despite sanctions. Northeastern countries and those in the West have faced the brunt of the war’s impact.
Based on a global assessment of food prices conducted by the United Nations (UN)’s Food and Agriculture Organisation (FAO), wheat prices on the global market have increased by about 2.1 per cent.
Hemsing said that the global supply shortage and price hikes are, nevertheless, being monitored by NAMILCO.