Tuesday, February 12, 2008

Jeddah Running Out of Bread

Tuesday, 12 February 2008
By Adel Al-Malki

JEDDAH - Many Jeddah bakeries closed their doors to customers because of ever increasing high flour prices.

Bakery owners waiting for flour from flour distributors said they were like beggars waiting outside a mosque. "I have closed one of my bakeries that has been in operation for 40 years, after tomorrow I will close the others," said Abu Ahmad who owns several bakeries in Jeddah.

Ahmad said that outside the Grain Silos and Flour Mills Organization (GSFMO) the atmosphere is more closely related to a mafia rather than a government flour distributor.

"There are a lot of people who sell the flour at unreasonable prices - they bought it from the government for SR22 then they sold it on the black market for more than SR80," Ahmad said.
Ahmad said that when he reported the high prices to the GSFMO about the illegal practices of the grain dealers, they responded by saying that was none of their business.

Flour sellers like Jadal Haq Hosein said he cannot provide customers with flour in sufficient quantities because he himself does not get enough from the distributors.

"Flour shops do not sell more than five kilograms per customer for two reasons: the first being we want to satisfy all our customers and secondly the distributors of flour don't supply shops with enough quantity," Hosein said.

Some customers spend up to three hours looking for bread. Many have asked the government for help. Adnan Kutubkhana, a Saudi customer said that bakeries cannot meet the demand of their customers in the conditions as they are.

"At these rates, after three days, the supermarkets and bakeries will be out of bread," Kutubkhana said.

"I looked for bread in more than 10 supermarkets, when I found it the bread vendor refused to give me more than two riyals' worth."

On Jan. 29, Saudi Gazette reported that the Ministry of Commerce would hold an emergency meeting with the GSFMO to resolve the issue of increasing flour prices.

Kutubkhana said he has not seen any action by the government as promised.

"Where is the control by Ministry of Trade and the committee that was formed to control the prices and markets?" he said.

Previously officials at the GSFMO said the shortage was caused by to several factors: a 10 percent rise in demand, population increases, suppliers not receiving flour ordered and flour smuggling to Yemen.

Poor management at the GSFMO is to blame, said a former grain supplier Ahmad Al-Ghamdi."The deliveries are not punctual and complaints have no effect. This is not a rumor, but if there is any talk of solving the problem, that is the rumor," Al-Ghamdi said.

Mesh'aal Al-Jabri, a flour distributor, said the crisis is orchestrated. Some workers reduce the quantity allocated to each retailer to force them to buy the flour at a higher price from the black market.

The GSFMO director at Jeddah's Islamic Seaport, Ali Obaid, said that the crisis would end in a few weeks.

The Ministry of Commerce and Industry, Sunday, called for an emergency meeting with flour distributors and bakery owners to discuss the matter.

Hassan Ageel, undersecretary for Internal Trade Affairs at the Ministry of Commerce, said: "The prices are being monitored and a solution to the problem is underway.

The meeting will hopefully be able to end this crisis by providing more flour in the market and have the price decrease once again.

Many bakeries in Makkah, nearby villages and Taif have also closed due to the shortage of flour.

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