Saturday, May 23rd, 2015

Sindh fails to sell wheat stock and set sowing targets

54b336f1abf2eThe time for sowing the wheat crop is going to be over, but the Sindh government has not fixed the targeted acreage yet. However, the federal national food security and research ministry has proposed a target of 1.15m hectares.

Wheat is currently being sown across Sindh, with the lower regions having almost completed the process while the upper region is to go for sowing late varieties, as usual. Unofficial reports indicate that 1.05m hectares of land were brought under wheat cultivation by the first week of January.

Sindh had reportedly opposed the federal target of 1.15m hectares in the October national food ministry meeting, insisting that the target for the 2013-14 season should be kept unchanged. The provincial agriculture department usually increases the sowing target after considering the mean output of three years of any major crop; this is less than 1.06m hectares for wheat. It was only last year when wheat was grown on 1.12m hectares, against the target of 1.1m hectares.

Reports of carryover wheat stocks also haunt the provincial food department, as it has not been able to sell last year’s stocks. Although the Sindh government has announced a Rs200 cut in price of a 100kg wheat bag, reports indicate only 60,000 tonnes of wheat have been sold.

The Sindh government has asked the federal government to bear the cost of rebate on the export of 660,000 tonnes of surplus wheat stocked in provincial storage facilities
Sindh hopes to sell 300,000 tonnes of grain by Thursday (January 15). When chief minister had announced the Rs200 cut, the food department had a stock of 1.1m tonnes.

It was the import of around 800,000 tonnes of Ukrainian wheat last year that affected the sale of wheat from the government’s warehouses. It was mostly consumed in the provincial metropolis. The importers bought wheat between Rs2,600 and Rs2,800 per bag, inclusive of overhead charges, when the government’s food department was issuing wheat at Rs3,450 to millers and chakki owners. This led to a glut in the commodity market.

Considering the present situation, the Sindh government has asked the centre to bear the cost of rebate on the export of 660,000 tonnes of surplus wheat stocked in the provinces’ storage facilities, says a senior provincial food official in Karachi.

The Sindh government hopes to sell 300,000 tonnes of the grain by Thursday
“We think the federal government must allow the export of at least 500,000 tonnes, keeping in mind that the remaining strategic asset/stocks may be needed for the drought-hit Tharparkar as the free distribution of wheat is continuing among the famine-affected there.” He believes that the lifting of wheat crop from the department’s warehouses will pick up pace now, given the Thursday deadline. The remaining crop will be sold to millers or chakki owners by end-February, before the new crop will start reaching market in March.

The provincial food department had met its procurement target of 1.3m tonnes in 2013-14. It had earlier thought to increase the procurement target to 1.5m tonnes for the 2014-15 crop season, but now it doesn’t rule out curtailing the figure to 1.3m tonnes.

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