Nov 02 2010 |
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Govt approves reintroduction of subsidy: OFM
MUSCAT -- A sharp rise in international wheat, maize and other commodity prices has prompted Omani authorities to approve the reinstatement of a subsidy, as well as approve a marginal increase in retail prices, according to a top official of Oman Flour Mills (OFM) .Manal bin Mohammed al Abdwani, Chairperson, Oman Flour Mills , stated in a report on the company's financial performance during the third quarter ended September 30, 2010, that international wheat prices had risen by over 50 per cent during the quarter under review.
This increase stemmed from the drought conditions in some parts of Europe, resulting in a ban by the Russian government on wheat exports.
Furthermore, the weakening of the US Dollar has also had a negative impact on commodity prices, resulting in higher freight costs.
Maize prices too have increased by over 60 per cent due to lower yields in the United States. Prices of other commodities have also increased over the last three months, she said.
"The sudden increase in commodity prices has affected the profitability of the company in the first quarter. The company did not increase its selling prices due to the month of Ramadhan. However, with the commodity prices continuing to remain at these high levels, the government has approved the re-introduction of the subsidy and a marginal price increase," the Chairperson stated.
Oman Flour Mills achieved a 4 per cent increase in sales volumes at the end of the 3rd quarter ended September 30, 2010, as compared to the same period of the previous year. The Group's net profit before tax for the three months totalled RO 1.57 million as compared to RO 3.49 in the previous year.
Net profit before tax amounted to RO 1.77 million as compared to RO 3.56 million in the previous year.
Meanwhile, the construction of an Industrial Bakery promoted by Oman Flour Mills is ongoing with commercial production set for mid-2011, the Chairperson stated.
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