Growing wheat prices burn UAE's roti makers
Posted by Zawya
Emirates Business 24-7, 31 July 2010


The sharp increase in the global wheat prices is worrying several hundred Afghan tandoori roti makers whose profit margin is coming under pressure.

There are many Afghan tandoor outlets in different parts of the UAE which solely make the traditional Afghan bread, especially for customers from Afghanistan, Pakistan and India.

Wheat prices have been skyrocketing due to an alleged cut in production in Russia, Europe and flooding in Canada and wheat growing areas of India. India, the second largest wheat producer in the world, is reportedly facing an "emergency situation" of a lack of storage for its grain stocks, with about 10 million tonnes of wheat and rice at risk of rotting due to exposure to monsoon rains.

Wheat prices soared by 20 to 25 per cent to touch $280-290 per tonne this month alone.

The Afghan nanwais (bread-makers) said the volume of rotis sold per day has come down by almost half and some of the shops have closed because of pressure on margins.

Says Yar Mohammed, owner of Marakish Bakery in the Sharjah Industrial Area: "The wheat prices have gone up from Dh 50 per 50 kg packet to Dh 90 now. For many years, we have been selling one roti for 75 fils and there are some bakeries selling even at 45 fils per roti, because there is no business and they are trying to lure customers by using low quality wheat."

He said the profit margins of roti makers have been thin and the volume of business has come down. "We used to sell 1,800 to 2,000 rotis per day when there were many customers in the Sharjah Industrial Area. Now the daily sales volume is down to 500 or 600 rotis."

He said Afghani roti is normally bought by inmates of the labour camps and residential buildings in the area.

The Sharjah industrial area has more than 40 bakeries, all engaged in the same business.

© Emirates Business 24/7 2010

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