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Increase in flour is an issue of supply and demand, says CEO Martinez

We also got a comment from the CEO of the Ministry of Economic Development Dr Osmond Martinez about the Government’s efforts to respond to this issue. He conceded that part of the problem is that the increase has a lot to do with Russia’s invasion of Ukraine, which has an impact on the supply and demand of wheat. 

Dr. Osmond Martinez, CEO, Ministry of Economic Development: “The key part right here is that consumption right now, investment right now is much higher than the supply and I will give you an example. If you would want to buy a vehicle right now and you go to a car dealer, the car dealer may tell you, you know what? We need 120 to 180 days before we can supply that vehicle to you and that is a, because of the disruptive supply chain mechanism. That was created, 1. Because of the pandemic and now because of the war. So in terms of flour, to be more specific, it’s of high concern because we have to look at the root of the problem and the root of the problem is that Ukraine and Russia are the highest producers in the world of wheat and that by itself is telling us that the highest producers of wheat now, they are not supplying us the wheat, which then, the demand is much higher than the supply and basic economics teaches us that once the demand is higher than the supply, there is a price increase.”