Averages are the most brilliant invention in statistics, yet they can be used to manipulate facts in the most devious ways. Consider that among major crops, average farm size under sugarcane in Pakistan is only 1.3 hectares (hec), compared to 1.7 hec for others such as wheat, cotton and rice.
The comparison implies that cane growers are predominantly small farmers, and hence, the most vulnerable segment among Pakistan’s rural population. This, in turn, is used as a justification to seek government intervention in the market, so a minimum purchase price be fixed so that “poor” farmers are able to receive a fair price.
Except, just scratching the surface of Agriculture Census reveals that the case made for “vulnerable cane farmer” is patently false. According to farm sizes under major crops reported in the last census, more than half of sugarcane farms are mid- or large-sized. Share of large-farms (out of total number of farms) growing cane is highest at nine percent compared to just three, four and five percent of wheat, rice and cotton farms respectively classified as large-sized.
The trend extends into mid-sized farms as well, defined as between two to ten hectares in size (equivalent to between 5 and 25 acres). About forty-eight percent of cane farms fall in this category, even as number of mid-sized farms for all other crops is no more than one-third of total.
Of course, number of farms on its own is an incomplete statistic, especially when measured in percentage terms. To this end, number of farms may be juxtaposed against aggregate acreage for each major crop under the three-tier farm-size classification.
Turns out, distribution of aggregate area under cotton, rice and wheat between small-, mid-, and large sized farms could roughly be approximated to a normal distribution. Aggregate area for each of these crops under both small- and large-sized farms is roughly one-fourth (for each category), whereas most of the bulge is concentrated in mid-sized farms – representing a bell-curve.
This distribution is most lop-sided for sugarcane. Out of the one million odd hectares under its cultivation, close to one-third consists of large-farms. Concurrently, aggregate area under small-sized farms is lowest at just 18 percent.
Then why is average farmsize under sugarcane lowest? Because averages are just as dependant on numerators. Compared to cane’s one million total acreage, area under cotton and rice averages at 3.7 million hectares, and at 11.4 million hectares for wheat, annually.
Put the pieces of the puzzle together and it is hard not to notice that sugarcane is the crop of choice for country’s large landowning farmers, known as zamindar’s in common parlance. While these two datasets alone do not point at an explanation, the most likely reasoning, of course, is the profit-motive. That is, among the alternatives available, cane is relatively low-risk and offers the highest return.
Whether zamindars’ lean towards cane because of higher than market indicative price or, because they are able to influence its price (in their capacity as a politically influential group), is a chicken and egg problem. Teasing out the causal relationship also holds little value in terms of policymaking.
The question relevant for policymakers is whether sugarcane as a crop deserves any preference. Despite populist notions to the contrary, this is not an easy question to answer as economic value added by cane extends beyond white sugar to include high value products such as fibreboard manufacturing, bagasse-power, and export quality ethanol.
But for those in media who haste to vilifying all cane growers as a politically vested pressure group, a parting thought. It is true that restricting or outright banning cane cultivation may hurt small farmers less than large landowners. And that means turning Pakistan into a net sugar importer. However, for that to be successful, the hue and cry raised every time white sugar prices shoot up must stop, because becoming a net importer means exposing retail sugar price to market forces in the global commodity market. Are we prepared?
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