Local Flour Mills are Suffering by the Ban on Maggi

Ban of Maggi in India has not only incurred a USD 50 million loss of goods for the company, but it has also hit the small and medium players in India at the ground level incurring a loss of around Rs 4-5 lakhs per month to them.

After, the Food Safety and Standards Authority of India (FSSAI), on June 5, banned Maggi directing Nestle to immediately withdraw and recall all nine variants of Maggi instant noodles from market, the flour millers have started dumping ‘maida’ into the market at a loss.

Kolhapur based Panchganga Roller Flour Mills, which has been supplying maida to Nestle for nearly 18 years, said the flour millers have been hit badly due to the ban.

“We would face a loss of at least Rs 4-5 lakhs per month because of the ban. Now we are selling the maida that we lifted from Nestle at a loss to the biscuits, noodles and other bread makers,” Managing Director of Panchganga Roller Flour Mills, D Manikchand.

He said it will take almost a year or two to re-stablish them in the market. “The burden will pass on further to their mills in terms of loan repayment, salaries etc,” he mentioned.

Manikchand said even the small flour millers, who supplied maida to Nestle, had adopted norms on hygiene and purity as per the international standards as demanded by Nestle. They used to spend huge amount for sample testing and quality certification. Panchaganga Roller Flour Mills used to supply over 25 tonnes to Nestle every day.

Nestle India is in the process of destroying Maggi instant noodles worth Rs 320 crore after it was banned by central food safety regulator FSSAI due to presence of lead and taste enhancer monosodium glutamate (MSG) beyond permissible limits.

The company said it is in the process of withdrawing the stock of Maggi Noodles from markets, factories and distribution and destroying it.

According to a media report, Traders body Confederation of All India Traders (CAIT) has sought government intervention to direct Nestle to make immediate refunds for recalled stocks of its Maggi noodles as the company has “blocked capital of wholesalers and retailers for nearly two months”.