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Taking the bull by the horns




  • If everything goes according to the script, Pakistan will reap a record wheat crop next year. Farmers firmly believe that the wheat output will surpass the official target of 22.50 million tons fixed for the next crop, which will be ready for harvest in April.

    The optimism about the next wheat yield stems from favourable weather conditions as well as certain timely initiatives – reduction in the prices of fertilizers(especially phosphate and potash) and increase in the wheat support price – recently announced by the government to help the farmers partly cut down their input costs and offset the negative impact of rising inflation.

    The government initiative to slash the prices of fertilisers, especially that of DAP, is expected help the growers save approximately Rs12 billion over the next one year in the shape of reduced expense on inputs.

    Wheat growers will benefit the most as a result of the cut in the prices as they use about 60 per cent of the total fertilisers sold for both Rabi and Kharif crops. In addition, the lower prices will encourage the farmers to increase the use of fertilisers, particularly DAP that pushes up the final crop yield.

    The decision to increase the wheat support price to Rs425 per maund for the next crop from Rs415 per maund last season is likely to make the farmers richer by Rs1.65 billion, according to AgriForum chairman Ibrahim Mughal. The net benefit that the wheat farmers are going to reap from these two government decisions is going to be around Rs8.5 billion or more.

    The government’s decisions to facilitate the growers for a better wheat yield are apparently driven by three considerations:

    1) Pakistan wants to raise its wheat output to 30 million tons by 2015; 2) Islamabad needs agriculture to grow by 4.5 per cent so that the overall GDP growth rate target of seven per cent fixed for the current financial year is achieved; and, 3) The ruling coalition led by Prime Minister Shaukat Aziz will be going into elections towards the end of 2007 and will require the support of farmers if it wishes to return to power.

    The wheat output target fixed for 2006-07 is up by about 0.8 million tons from the last year’s production of 21.7 million tons. This year farmers are expected to grow wheat on 20.903 million acres – 15.93 million acres in Punjab, 2.27 million acres in Sindh, 1.88 million acres in the NWFP and 0.83 million acres in Balochistan. This compares with 20.53 million acres of land brought under wheat cultivation during last year.

    Farmers say the area to be brought under cultivation of wheat will also surpass the official target because of wet weather that actually encouraged farmers in the Barani areas in Sindh as well as Punjab to start sowing since the first half of this month. The wet weather conditions will also help improve the final output of the crop.

    The national average wheat yield per acre too is estimated to rise to 27 maunds per acre this year from last year’s 26.43 maunds. Though it looks like an ambitious target if the past is anything to go by, it still is achievable in view of the positive steps taken by the government to encourage the wheat sowing.

    The wheat yield per acre is highest in Sindh (30 maunds) followed by Punjab (27.94 maunds), Balochistan (21 maunds) and the NWFP (16.66 maunds).

    If everything goes right, Pakistan, which will begin the next wheat harvest with a carry-over stock of over one million tons, will have at least two million tons of surplus.

    The government’s recent initiatives like increasing procurement price to encourage wheat production in the country apart, farmers in Punjab strongly favour reduction in their input costs. “The increase in the wheat procurement price is good. But higher procurement price always leads inflation to rise, ultimately impacting negatively on the input costs. Therefore, the government must ensure that the farmers’ expense on inputs is reduced,’ says Mughal.

    “There are around one million tube-wells and 425,000 tractors that will be operating during wheat sowing and afterwards. The government must slash the rates of diesel and electricity, which form a major part of the farmers’ input expense, required to operate tube-wells and tractors,’ says Mughal.

    He says the wheat output can be increased manifold if the government ensures increase in the availability of certified seed. At present only 14-15 per cent certified seed is available with the public and private sector. “Ideally, 20-25 per cent of the total seed used should be certified ,’ he says.

    Besides, he says, weeds are a big threat to the crop and cause a loss of 15-20 per cent in the final outcome in addition to adding to input costs as farmers have to use greater quantity of fertilisers than is required.

    “Should the government provide easy, long-term credit to farmers for purchasing herbicides to fight the threat of weeds, we can substantially increase our output. Total amount required to fight the threat of weeds will not be more than Rs4 billion. But its ultimate benefit to the economy will be greater than Rs20 billion. Should we increase our per acre yield by one maund, farmers will get an additional Rs8.8 billion. You can imagine the kind of impact it will leave on their lives.’

    Farmers also fear that the surplus crop will bring its own old problems with it and increase their post-harvest losses as the government’s procurement is slow and inefficient.

    “The government enters the market quite late. By the time it comes into action, it is already too late for the hapless farmers who do not have arrangements to store their produce. They are forced to sell their produce at discounted rates, far less than the official procurement price, just to make sure that it is not wasted,’ says Mughal.

    “The government needs to start addressing these issues – input costs as well as post-harvest difficulties faced by growers in selling their crop – right away. If it is done and these issues addressed properly, we can become a permanent wheat exporting country to such destinations as Iran, Turkey, India, Afghanistan, etc in the years to come,” he says.

    But the question is: “Who is going to take the bull by horns?’

    Courtesy: The DAWN

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