WHEAT TARGET 2008-09: PROSPECTS
Mar 16 - 22, 2009
FAO has estimated that the next global wheat harvest for the year 2008-09 will hit a new record and improve supply position to meet the world's wheat and flour demand. According to its estimate, there would be a 10 percent increase in the world's stock.
The government of Pakistan has announced the support price of wheat at Rs.950 per 40 kg. The purpose behind this price increase is to support wheat growers now when prices of inputs are sky rocketing and to attain self sufficiency in food, so that farmers feeling tempted may increase the area of cultivation while sowing wheat crop and may work harder to increase production.
However, farmers are constantly facing great difficulties in procuring and getting inputs at reasonable prices and in time, Supplies of improved seeds, quality fertilizers, diesel, electricity, irrigation water etc. are all their common difficulties.
Nature has been generous and kind enough to provide light rainfalls in different parts of Pakistan in December 2008 and January 2009. Therefore, there has been a favorable impact on the crop production.
Rain-fed areas have especially been fortunate to get a boost in growth of wheat and chickpea crops. However, the government could not maintain supply of fertilizers as well as water piracy by India with the construction of Baghliar dam and other barrages and dams imperiled irrigation system in Pakistan. It is feared that wheat crop production may suffer a downfall of 20 percent as compared to Pakistan's target due to the aforementioned reasons.
However, good wheat support price and exploitation of farmers in the hand of sugar mills have turned farmers to switch over to wheat and paddy harvesting from growing sugarcane.
Problems and plights of our farmers are endless. The last paddy crop was no doubt a bumper crop in Pakistan but the dealers (Arhtis), market exploiters, and rice mills delayed buying the crop to compel the farmers to sell their produce at a low price. Small farmers had to dispose of their produce of Basmati paddy at Rs.1000 to Rs.1200 per maund as against Rs.1500. It is an unfortunate state of affairs that instead of farmers, ultimate beneficiaries of bumper crops are exporters, smugglers, hoarders and black-marketers, who use vulpine techniques and tactics to compel the farmers to sell their crops at throwaway prices.
In the world's market the present position of wheat price is that, it has come down to $227 per ton i.e. approximately at Rs.17 per kg. Thus while the present rate of wheat in the world's market is Rs.675 per 40 kg, the support price of wheat as announced by the government of Pakistan is Rs.950 per 40 kg. The difference between the world's average price and our support price of wheat is Rs.275 per maund.
The trends, tendencies, and traditions of our local market indicate that the private sector would not be willing to pay wheat price as per predefined support price of Rs.950 per 40 Kg. Small farmers who cannot hold back their harvested grain suffer a lot of inconvenience and hardship because of blackmailing of wheat dealers and due to their utmost need of disposing of their harvested crop at the earliest to arrange for the inputs for the next crop and to pay back the bank loan taken for the last crop.
However, the former Chief Minister Punjab Shahbaz Sharif realized this fact sympathetically and it is optimistically hoped that his vigilant and farmer-friendly attitude would not allow the private sector to exploit the situation in their favour. As the province of Punjab contributes over 75 percent of the total wheat production in the country, the government should start procurement of wheat in bulk right from its initial harvesting stage so that farmers are not exploited by the private sector and they get the right price of their outputs without any inconvenience and without any delay.
The wheat prices in Pakistan and India are much higher than the average world price. It has also been observed that the major wheat producing countries have reduced their wheat cultivation due to sharp downward trends in international prices. This is a positive aspect for Pakistan as there is likely to be shortfall to be filled by the countries producing surplus quantity of wheat. Naturally, when there is a wheat glut, rates may rise to meet the need. The government of Punjab had fixed wheat target for the 2008-09 at 20 million tons against the total national production target of wheat of 25 million tons.
A substantial quantity of wheat is either exported or smuggled across the border to Iran and war-ravaged Afghanistan. Wheat production prospects in Afghanistan are bleak. According to FAO's estimate, the wheat rates in Afghanistan are 70-100 percent higher than in Pakistan. Pakistan thus has a good opportunity to sell its surplus wheat and grain crop to these neighbouring countries through a regular road transit system instead of allowing smugglers to mint money and cause an acute shortage within the country. Money earned by smugglers and through an irregular way does not find its way into the mainstream of economic system and investment, as smugglers try to hide black money.
The Planning Commission's task force has already identified that the major cause of wheat shortage in Pakistan is its smuggling to Afghanistan because the Pakistan ñ Afghanistan borders are porous and the rates of wheat in Afghanistan are much higher. It has been speculated that if this menace is not controlled, smuggling of wheat may exceed the government's estimate of 2.5 million tons during 2008-09. There are speculations of wheat and atta crisis in Pakistan in case this smuggling goes on unabated. The government must utilize all its resources to increase the production of wheat in order to ensure food security in the country and to avoid any possibility of wheat and atta shortage and consequently the necessity of wheat import from other countries at double the price.
Advisably, for maximum procurement of wheat, government in particular the government of Punjab should start taking measures to procure maximum quantity of wheat. As a first step, it should have its storehouses properly repaired, renovated, and fumigated so that not even a minor quantity of grain stored therein is lost, wasted, or damaged.
PASSCO and Food Department should also be activated to do the needful and be prepared to extend their services efficiently at the appropriate time. Bags should be arranged in sufficient number right now. Payment to the farmers should be made well in time so that that they may not have to shuttle from pillar to post to receive the payment.
In order to increase the total production of wheat as well as yield per acre of other crops, government should pay heed to following considerations:
- Provision of certified wheat seed and seeds of other crops much before the sowing season
- Suitable wheat support price should be announced by the government earlier to the sowing of major crops of wheat, rice, maize, cotton and sugarcane so that farmers are tempted to work harder and harder for increasing the overall production and per acre yield of respective crops.
- Credit facility should be increased and its access may be made easy for small farmers by opening more and more banks in rural areas.
- Agriculture department must activate and update the knowledge of its Extension Service Staff for properly guiding farmers about:
i) Modern and scientific ways of agriculture
ii) Water management including drip irrigation etc.
iii) Soil leveling by laser technology
v) Weeding out unnecessary weeds and pest control to avoid damage to crops
vi) Increasing organic matter of the soil by using cow/cattle dung, crop rotation and growing leguminous crops.
vii) Water conservation by constructing small dams, seasonal canals and conserving moisture in rain-fed areas etc.
It will be appropriate to mention that only Helpline Service will not help. The gap between theory and practice can only be minimized if the Agriculture Department is in itself well equipped with knowledge and modern technologies and its work force should impart the requisite knowledge to farmers by practical demonstration in the field.
The role and contribution of Punjab in agriculture sector is quite significant. Former Chief Minister Punjab is no doubt all out to remove the difficulties and solve problems of farmers as more as possible by facilitating supply of inputs to get maximum output. Punjab is currently contributing 80 percent to the country's total production of cotton, 77 percent to wheat production, 95 percent to rice, 70 percent to sugarcane and is leading in producing citrus fruit, especially Kinno, which is a valuable exportable fruit.
There is still a great scope to increase production of agricultural commodities and crops and the government of Punjab was sparing no pains in harnessing all available resources to make Punjab a real food basket for the country and to boost the country's economy by exporting the surplus as well as value added products through value addition by means of agro-based industries and cottage industry, which is yet to be developed in the real sense.
Supply of genuine fertilizers at the right time and at the right prices to farmers is of utmost importance. The private sector, businesspersons, and fertilizers dealers try to extort extra money by hoarding and exploitation and by creating artificial shortage. It may be worthwhile to mention that private companies do fertilizers manufacturing and has control over its marketing.
The government was kind enough to subsidize the generously manufacturing of urea fertilizer. Natural gas is supplied to fertilizer companies at a very low rate and GST has been abolished. On the other hand, urea fertilizer rates have doubled within one year. A subsidy of Rs.3000 per bag has been provided on DAP fertilizer but farmers are getting DAP at a high rate of not less than Rs.2700 per bag. It appears that the subsidy allowed to the manufacturing sector is not allowed to trickle down to farmers. The federal and provincial governments must endeavour to alleviate genuine problems of the agriculture sector especially relating to fertilizers so that farmers may heave a sigh of relief and be able to increase production to make Pakistan self sufficient in food supply and to help export of the surplus to boost the economy and reduce poverty in the country.