Wheat crisis has further deepened despite the tall
claims of federal and provincial governments resulting a historic surge
in the atta pricesah Khan Jamali's government and kept gradually
deepening, bringing the atta prices in retail from Rs. 17 to Rs. 21 per
kilo in urban areas especially in Karachi.
"How can wheat crisis end until the matter is
not taken at the required level on its due priority," said a
government officer from the food department with the request of
anonymity. He further said that minting money with the connivance of
corrupt officials of the food department. "Isn't it a money minting
game when crisis deepening even when government has removed the
shortfall by importing wheat? another senior officer said in an
There are different justification by the mill owners,
chakki owners and retailers, while the government has different
justifications every day apart from tall claims. Sources said that
government could not or did not bring out the hoarded wheat from
interior parts of Sindh and Punjab provinces.
Some market players had warned early this year
(January and February) that whole country, especially Sindh would face a
wheat crisis again in the coming months possibly in Oct and Nov and
beyond — as no clear roadmap had been drawn, either on the provincial
or on the federal level to meet about 1.8 million ton wheat deficit.
The deficit was inevitable because officials in the
Sindh government expect a harvest of 2.2 to 2.3 million tons from the
current crop. The demand for about 35 million population in the province
at per capita consumption of 124 kilograms was estimated around 3.9
million to 4 million tons.
"We rely entirely on wheat supply from Punjab
and Passco to meet this deficit in the coming year," a senior
official told PAGE. This year both Punjab and Passco let down
Sindh in matter of supplying wheat in time, hence, the crisis lingers on
till to date.
The supply of wheat from Punjab godowns to Sindh is a
multi-million rupee game in which brokers, traders, millers and
transporters join hands with some corrupt officials of the food
department to rob consumers.
There was no scarcity or shortage of wheat this year
in Karachi and Hyderabad but supply of wheat was tightly regulated by
brokers, traders and millers in collusion with these officials to ensure
that prices of flour and bread go up and everyone of them made huge
profits since October last.
Officials hope countrywide harvest of over 20 million
tons of wheat in which the bulk — almost 18 million tons - will be in
Punjab. The government wants to procure officially more than five
million tons of wheat in the current season to maintain a buffer stock
which means that about 12 to 13 million tons of wheat will go in the
The Sindh government has commenced wheat procurement
operations to secure at least 0.6 million tons. It is reported to have
obtained a credit margin of Rs7 billion from banks at 1.4 per cent rate
early this year.
But it is facing some problems in procurement. The
open market prices of wheat in Karachi are far more attractive to the
farmers than the officially fixed prices of Rs350 for 40 kilograms at
the procurement centres.
Flour millers accuse the provincial government of
obstructing the transportation of wheat harvested in the interior to
Karachi. "Wheat carriers are made to pay Rs25 to Rs30 on a bag of
100 kilograms on the truck," a flour miller said.
In March this year Mr. Bilal Aslam Sufi, a former
Chairman of the Pakistan Flour Mills Association had alleged with some
document accusing some officials of 'unprecedented corruption'. His
prescription is to wind up the department and liberalize wheat trade.
On the other hand, officials in the Sindh food
department contend that a strong lobby of wheat brokers, millers and
traders do not want wheat procurement operations to be successful in the
"Wheat trade cannot be allowed full
liberalization," an official said, and maintained that in
developing countries governments had to intervene because
"sensitive items like wheat and bread cannot be left at the mercy
of market forces." But he conceded limitations of his department,
causing a lot of problems for consumers.
Sindh government's strategy was to procure 0.6
million tons of wheat by late April or mid-May and stock it. The
strategy was that farmers may retain with them about half a million tons
of wheat for self-consumption and bring about a million tons in the open
Release of wheat from government stocks was expected
to begin from July or August to meet the shortfalls of the flour mills
from their wheat purchase from the open market.
The Sindh government expected release of 1.2 to 1.5
million tons of wheat from Punjab and Passco for which the officials
were expected to place a demand before the federal government and seek a
firm assurance of supply at times when demand is most pressing.
Karachi and Hyderabad with almost half of Sindh's
total population of 35 million are located far away from the wheat
growing areas. The total demand of wheat in these two densely populated
urban areas of Sindh is said to be over 120,000 tons a month. "This
has become a favourite hunting ground for the profiteers and
hoarders," said a market watcher.