Punjab Food Department and Pakistan Agricultural Storage and Services Corporation (Passco) are all set to initiate annual wheat procurement drive by mid of next month and at present awaiting the procurement targets and support price. Both the federal and provincial government procurement agencies have also finalised the financing deal with different banks.
The Punjab Food Department alone would need Rs 200 billion for wheat procurement this year if the procurement price is notified at Rs 1,050 per maund. This was disclosed at a discussion arranged by the Agricultural Journalists Association (AJA) Lahore on 'Wheat Procurement Drive 2012' here on Friday. Passco was represented by its General Manager (Fields) Colonel Tanvir Hussain and the Punjab Food Department was represented by Food Director Najam Shah.
Growers were represented by Kisan Board Pakistan Vice President Sarfraz Ahmad Khan and Wheat Growers Association President and Farmers Associates Pakistan (FAP) Director Chaudhry Hamid Malhi while flour millers and wheat exporters were represented by Dr Bilal Aslam Sufi and Khalique Arshad respectively. AJA President Munawar Hassan also spoke on the occasion and threw light on holding a debate of all the stakeholders before the initiation of procurement season.
Addressing the conference, Punjab Food Director Najam Shah disclosed that Food Department had made arrangements for the procurement of some four million tons of wheat, while it might be assigned to buy some 3.5 million tons of grains. He said Punjab government had negotiated with a consortium of 29 commercial banks to provide financing for the annual wheat procurement campaign.
He hinted that Punjab government would require around Rs 200 billion for wheat procurement, if the provincial government fixed wheat support price at Rs 1,050 per maund. Punjab government would sign financing agreement with banking consortium during the next week.
Highlighting the salient features of the provincial wheat procurement policy, Najam said that to avoid malpractices and mismanagement the government had decided to depute a grade 17 official on all procurement centres. In addition, Food Department had decided not to repeat gunny bags supply to same farmers in the first 15 days. This measure would help food department to maximum facilitate small farmers and avoid profiteering, he added.
Passco GM (Field) Colonel Tanvir Hussain (Retd) disclosed that Passco had made logistics and financial arrangements for the purchase of 1.5 million tons of wheat, and said Passco would start its wheat procurement drive sometimes in mid-April. He said the Corporation had divided 20 Tehsils assigned by the different provincial governments in Punjab, Sindh and Balochistan in to 11 zones for a smooth procurement and to facilitate small growers.
It would establish five to seven procurement centres in all tehsils after consulting with provincial food departments. Tanvir underscored that as around 80 percent farmers had small landholdings - less than 12 acre - Passco would mainly focus on these peasant farmers.
Passco GM pointed out that his agency had made arrangements for the supply of gunny bags and bags were being dispatched on procurement centres. Passco would store all wheat stocks in gunny bags due to its better quality and as per the requirement of its clients, he added.
Speaking about the wheat storage arrangements, Passco GM said that Passco had covered storage for around 0.43 million ton of wheat, while it was establishing silos for 0.65 million ton additional storage. The new storage capacity would be of international standard and would be available by 2014, as Islamic Development Bank had approved financing for this project.
Kisan Board Pakistan (KBP) Vice President Sarfraz Khan said that though the government had revised wheat support price from Rs 950 to Rs 1,050, but farmers were not being benefited from the increase. He pointed out that during the last couple of years cost of agriculture had been multiplied due to increase in the price of fertilisers, electricity, diesel and pesticides, and said that non-availability of quality seeds, weedicides and lack of awareness were other hurdles reducing per acre yield of almost all agriculture crops.
Wheat Growers Association President Hamid Malhi underscored that it was agreed among stakeholders that farming practices and input constraints were hitting agriculture growth, but agriculture marketing had its own weaknesses. He indicated that every trade required prompt decision making and timely action, but the government agencies involved in the marketing of agriculture commodities lacked swift decision making, which resulted in that Pakistan could not offload its surplus wheat stocks.
He suggested that the government should constitute separate wheat or commodity boards at both federal and provincial levels and should empower them to make swift decision making and market agriculture commodities while observing the international market trends. He also suggested that officials working in various government agencies required training and exposure of international markets and trading practices. They should participate in international grain conferences.
PFMA former chairmen Bilal Aslam Sufi and Khaleeq Arshad said that the government had increased the wheat support price, which would ultimately reflect in the flour price. They estimated that after the increase in wheat support price flour price would be increased approximately Rs 100 per 20-kilogram bag.
They were of the view that the storage capacity should be increased for grains in the country besides if government wanted to give any subsidy it should be given to growers in shape of cheaper inputs. Sufi also urged the government to review the decision of granting MFN status to India keeping in view the prices of wheat and flour in India as "if these two commodities started coming to Pakistan it would ruin our growers."