Pakistan: Subsidy, price recovery boost wheat exports
After a gap of five months, the country exported 65,649 tonnes of wheat alone in February fetching $12.5 million compared to nil foreign sales of the commodity since September 2017.
Recovery in world prices and increased subsidy have contributed largely to resumption of wheat exports.Total wheat exports in the first eight months (July-February) of this fiscal year stood at 65,822 tonnes earning $12.6m as compared to 3,676 tonnes ($0.967m) in the corresponding period last year.
Wheat exports in July and August 2017 stood at 353 tonnes ($114,000) and 733 tonnes ($209,000), respectively, Pakistan Bureau of Statistics (PBS) data showed.
The Economic Coordination Committee (ECC) of the Cabinet in its meeting held in third week of December 2017 had approved a proposal of the Ministry of National Food Security and Research allowing Punjab and Sindh to export 1.5 million tonnes and 0.5 million tonnes of wheat, respectively, including wheat products before June 30.
The ECC meeting had noted that the country would reap a bumper crop this season and the carry-over wheat stocks should be exported to improve financial position of the farming community besides fetching foreign exchange, notwithstanding an expected increase in domestic prices.
All Pakistan Flour Mills Association Central Chairman Ch Ansar Jawed told Dawn on Saturday that a 5pc rise in international prices coupled with export subsidy of $120 per tonne by land and $169 per tonne by sea routes had restored the confidence of wheat exporters to strike deals with buyers from UAE, Sri Lanka, African countries and Afghanistan.
Pakistan is all set to harvest 26 million tonnes of wheat this season almost same quantity achieved in the last two years. The country has now 6.5-7m tonnes of wheat stocks of last year while annual domestic consumption stands at 23m tonnes, leaving three million tonnes surplus stocks for export, he said.
The new Sindh’s wheat crop arriving is selling at Rs3,030 per 100 kg bag in Karachi after a drop of Rs150 per bag in the last few days. Old wheat is available at Rs3,250 per 100 kg bag.
He said Punjab’s wheat crop would hit the market in the next 10-15 days, he said.
Karachi Wholesalers Grocers Association Chairman Anis Majeed said huge subsidy by the government has proved a big relief to clear stocks at a time when only government’s warehouses are available which cannot store bumper crop as well as carry-over quantity of last year.
“If we have enough storage facility then we can keep wheat for at least one year and make exports when international prices go up,” he added.