Wheat crop prospects

To gain self-sufficiency in food items has always been an important objective of government policy in Pakistan. However, the matter seems to have assumed greater urgency after acute shortage of wheat and sharp increase in its prices in the recent past.
Wheat, it may be stated, is the main food item of Pakistani people and its availability and cost are, therefore, important determinants of the popularity of the government and welfare of the public at a particular point of time.
The main reason for wheat scarcity during FY08 was a sharp reduction in its output to 21.8 million tons as compared to 23.3 million tons a year earlier due to both decline in acreage and drop in the yield per hectare. Delayed start of sugarcane crushing season and cotton picking caused reduction in the area under wheat crop while insufficient availability of irrigation water at sowing time, uncertainty about returns (due to non-announcement of a support price for FY08 crop) and higher fertiliser prices also discouraged wheat farmers. This was particularly evident in Punjab, which contributes over 75 percent of the total wheat production in the country. In order to overcome shortages of wheat in the country, the government had to spend $852.3 million on the import of the commodity in FY08 as compared to only $41.5 million in the preceding year.
In order to avoid the bitter experience of frequent shortages and soaring prices, the government took a number of steps to increase the output of wheat crop during FY09. Incentive signals were boldly activated by increasing the support price of wheat by 52.0 percent to Rs 950 per 40 kg for FY09 crop, much before the sowing season and a target of 25.0 million tons was fixed for the year. Also, efforts were made to supply the necessary fertilisers at subsidised rates. However, initial reports are not very encouraging. According to the State Bank's estimates, wheat harvest is likely to fall in the range of 23-24 million tons due to the shortage of 39 percent in irrigation water for rabi crops.
The farming community is also not optimistic about achieving the target. Ibrahim Mughal, the Chairman of Agri Forum, Pakistan, is of the view that the government should start a campaign for increasing the use of weedicides and micro-nutrients immediately and announce an increase in procurement target for the final production to be close to 25 million tons. Another official of the Forum, Rana Majid Zafar has said that the government fixed the high target without turning the factors of production positive. No better wheat variety was introduced to ensure higher yields and sowing of certified seed was not increased. The sowing of the crop stood at only 28 percent on 20th November, 2008 which means that over 70 percent sowing would fall under the late category.
Some other Forum officials have stated that usage of fertilisers has dropped steeply due to skyrocketing prices. Credit crunch has also adversely affected the use of inputs. The import of 250,000 tons of wheat by the TCP at the time of local harvest also looks like a disincentive to the farmers.
Although it is too early to make a definitive assessment of the size of wheat crop during the current year, early indications coming from diverse sources are certainly inauspicious and we would like to highlight this negative view because price stability and ample availability of wheat the year-round is too important in our context and at least some of the factors impeding the achievement of the target could still be taken care of at this initial stage. Weeds, for instance, often reduce crop production as they compete with the crop for nutrients, water, light, gases and space and the use of weedicides could be increased from the current 10 percent of the cropped area to a reasonable level through effective involvement of the provincial agricultural departments in the exercise.
The government could also announce that it was committed to buying surplus wheat at official rates through its own agencies like Passco and would not leave the farmers at the mercy of exploitative market forces. Financial institutions engaged in providing agricultural credit could also be persuaded to provide adequate credit for the wheat crop.
Overall, however, there is no doubt that Pakistan needs to change its policy orientation and address certain structural issues on a priority basis in the agricultural sector like poor crop management skills of the farmers, lack of agricultural infrastructure, higher post-harvest losses, limited research as well as the gap between available research and practical applications. Needless to mention that adequate availability of energy is also quite important to supplement water resources and increase overall efficiency in the agricultural sector.
Also important for the government is to resolve to never repeat the mistake of the past year of allowing export of wheat due to the incorrect assessment of a bumper wheat crop. We don't want to say anything about last year's bad experience because so much has been said already but would like to advise the government that it should continue to monitor the crop position very closely and then base its judgement on the conservative side. If needed, sufficient quantity of import should be arranged from the international market well in time to discourage unnecessary speculation in the domestic market.
Adequate availability of wheat at reasonable prices throughout the year would definitely be comforting for the ordinary people who see no end to the flurry of bad news in their lives these days. The perils of empty stomachs are too severe to even contemplate.