Emerging second player:

Serendib to enter flour market

Shirajiv SIRIMANE

Serendib Flour Mills (Pvt) limited will be entering the local wheat flour market soon.

The company will be investing Rs. 6 billion for their operations in Sri Lanka.

A subsidiary of Al Ghurair flour Millis in Dubai, the Company has already installed machinery and are in the process of employing more staff. Testing of flour for the local market too has commenced and samples have been distributed to buyers.

The new company based in Wellampitiya would be importing raw material via the Colombo Port for processing.

“This would give a price advantage for the consumers as it would save transport charges” an company official said.

Prima Lanka a subsidiary of Prima Singapore, is based in Trincomalee.

Meanwhile it was announced that the price of wheat has risen above US$ 10 a bushel for the first time.

The price of wheat has more than doubled since the beginning of this year, as adverse weather reduced output in the major exporting countries of Australia, Argentina, Canada and United States.

The reduced output comes on top of high demand, partly also generated by the Biofuel industry.

The supply will remain tight until new crops are harvested in United States and Europe in July and August 2008. Finagle Lanka Limited, Akra Bakers followed by Perera and Sons and Prima Lanka Limited use flour on a large scale to manufacturing bread and other flour- based products.

In addition there is major a retail market for wheat flour by mainly to manufacture bread and other flour based products by individual bakers and households.

Marketing analysts point out that a second player to the market would create better competition and would help to give a better deal to the consumers.

In the gas market too with the intervention of the second player there are two price levels in the market.