KARACHI: The imports from Ukraine are expected to be disrupted as shipping companies have stopped accepting bookings for cargoes to/ from Ukraine.
However, Pakistan is unlikely to face a wheat shortage or any price hike in the next couple of months, despite the import disruption from Ukraine, market sources said.
According to the United Nations COMTRADE database on international trade, Pakistan imports from Ukraine stood at US$739.51 million during 2021, which was a record high since 2010.
It said that wheat and other cereals were the major import of Pakistan from Ukraine, which was around US$477.85 million in 2021.
Speculations regarding the wheat price hike and its shortage in the coming months have already started, following the announcement made by the shipping companies that they are unable to accept bookings for cargoes to/ from Ukraine due to the ongoing and rapidly escalating security situation in Ukraine. These speculations suggested that the wheat price would go doubled if the imports from Ukraine remained suspended in the next 2-3 months.
On the other hand, the shipping companies have also started diverting their vessels from the Odessa port of Ukraine and declared the voyage as ended in the last port prior to Ukraine for the cargoes destined to the war-torn country.
The shipping companies were of the view that the stacking areas at hubs in the region were already over-occupied and the expected impact of the Ukraine situation would disrupt the existing global supply chain.
When asked, the market sources said that the wheat was a Rabi crop that was grown in the winter season, and in Pakistan, sowing of wheat took place from October to December and harvesting during the month of March to May.
Therefore, there is no possibility of a wheat price hike in the next couple of months in case of no natural calamity or mismanagement, sources said.
They further said that the decision taken by the government in 2021-22 to prioritize maintaining a large wheat reserve would also help avoid the impact of the current situation on the market price of wheat. They said that the wheat production was expected to be 27 million tons in 2021-22, an 8% increase over 25 million tons produced in 2020-21. Keeping the said in view, the sources urged the government to place strict monitoring on wheat exports in order to avoid its shortage and price hike in the country.
Copyright Business Recorder, 2022
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