Review of flour crisis.

Byline: S. KAMAL HAYDER KAZMI

In Pakistan, sustainable growth of the agriculture sector stands as per the Government of Pakistan's officials, vital for food security and rural development. It is a major contributor to employment and foreign exchange earnings. In addition to that it offers industrial raw materials, hence growth in this sector has multiple linkages with the overall economy. The officials also recorded that wheat is the staple crop and it ensures food security in Pakistan. It is cultivated over 22 million acres and accounts for 7.8 percent of the value added in agriculture and 1.8 percent of GDP.

Self-sufficiency in wheat has been an objective of every government and thus always a problem for agriculture experts and policy makers. Wheat is a strategic crop and any shortfall in its production can create an awkward condition leading to political unrest, significant drainage of foreign reserves, rise in prices of wheat flour and pocket shortages in vulnerable areas.

Sources recorded that the Pakistan Flour Mills Association (PFMA) has made an urgent plea to the federal government for permission to import 1.0 million tons of wheat in a bid to avert an impending flour crisis caused by the hoarding of grain during the provincial procurement drive. The Association warns that if action is not taken promptly, the nation will face an artificial scarcity of flour. Statistics showed that the imported wheat if approved, would cost millers around Rs 85-90/kg, considerably lower than the current price of locally grown wheat, which stands at Rs 125/kg. This price differential would translate into a retail price of about Rs 110/kg for the imported wheat flour, as opposed to the current range of Rs 150-175/kg for locally produced flour.

Despite the potential cost advantage, concerns arise regarding the quality of the imported flour against domestically produced flour. While the quality of the latter remains superior, the price of flour (No 2.5) made from local wheat has greater than doubled in present years, standing at Rs 70/kg some 2 years ago as against the present cost of Rs 125/kg. During 2021-22, the area sown decreased to 8,976 thousand hectares (2.1 percent) against last year's of 9,168 thousand hectares. The production of wheat declined to 26.394 million tonnes (3.9 percent) compared to 27.464 million tonnes produced last year. Wheat production declined due to a decline in area sown, the shortfall in irrigation water and drought...