Govt directs provinces to import wheat direct amid shortage crisis

LAHORE: The federal government has directed provinces to import wheat to counter the shortage of the product in the country, reported The News.

According to a letter seen by The News by the secretary to food security ministry, the government has said the provinces might prefer to directly import the requisite quantity of wheat.

“Public sector might also consider releasing their subsidised wheat to create price equilibrium in the local market,” he said in a letter to chief secretary Punjab.

The letter also cited a decision of the meeting of Economic Coordination Committee (ECC) in mid-July in which the provincial governments, Pakistan Agricultural Storage and Services Corporation (PASSCO) and Trading Corporation of Pakistan (TCP) were told to arrange wheat imports as soon as possible to avoid shortages any time during the year.

“Provincial governments, PASSCO and TCP may also immediately invite tenders/bids for import of wheat in order to meet the wheat deficiency in the country,” the secretary said. “Provinces desire to immediately convey their estimated demand of wheat, required till the next crop season for human consumption and replenish the released stocks. The immediate release of wheat out of the available stock is expected to stabilise wheat prices and ensure availability of wheat at an affordable level.”

The secretary further said the government has taken immediate steps to mitigate the estimated total shortfall of around 1.5 million tonnes.

Keeping in line with the ECC’s previous announcement, the provinces have been asked to intimate wheat deficiency in respective federating units in order to meet the shortfall and replenish the released stocks at the earliest.

Insiders say authorities would have to make double the amount of efforts for bringing the price of imported grains at an affordable level since the current rate of wheat in the international market was much higher than local prices.

If such issues of price variation are not addressed timely, there will be no desirable response from importers, they said.

Giving details of arriving shipments and expected price of imported wheat, an insider said, as many as 25 private companies have so far finalised a deal for import of 499,600 tonnes of wheat. Except for a few traders from upcountry, most of these traders belong to Karachi.

Among these deals, two mature contracts are reportedly destined for Pakistan and may reach between last week of August and the first week of September this year. One vessel carrying 65,000 tonnes of wheat and another with 60,000 tonnes will bring much-needed grains in about a month.

The insider further said wheat being imported from Ukraine would cost $235 per tonne, which translates into Rs39,480 in local currency. After Rs3,100 port charges, the landed per ton price of wheat will be Rs42,580 or Rs1,703 per 40 kg at Karachi. By adding Rs100 upcountry freight, the price of imported wheat in Lahore would be Rs1,803 per 40 kg, which was way higher than the official release price of Rs1,475 being charged from the flour mills in exchange to government stocks.

The ECC, in the last meeting, had directed the ministry of food security to accelerate efforts for wheat imports with a view to ensure the availability of wheat and atta in the country throughout the year and on affordable price.