March 14, 2007

Wheat exports from Pakistan seen to rise
 

An international body has forecast wheat exports from Pakistan will increase in the next few years, giving a new life to the country's traders and agriculture authorities, but doubts remain if shipments could fetch good prices.

A recent report issued by the International Grain Council (IGC) suggests wheat exports from the country are likely to remain higher than previous years after exports resumed in January 2007 on slight decline in shipments from the European countries.

The IGC report, focused on world wheat production, consumption and trade outlook said, exports by Pakistan and Russia will be larger than previously expected but a reduction on European Union shipments are also seen.

The report also said tight availabilities and high prices are restraining both food and feed uses but industrial use will be larger than last year because of increased ethanol production in the EU and Canada.

The report also highlighted better production forecast during 2007-08 season, which could lead to a decline in wheat demand mainly in the importing countries.

Estimated production is lifted by 1 million tonnes to 590 million, an increase in the estimate for Turkey more than offsetting a reduction for Brazil. Forecast consumption is also 1 million tonnes up, at 607 million, added the IGC.

The IGC report came amid concerns being shown by exporters over the government-devised mechanism to make shipments of more than half a million tonnes of wheat allowed in December 2006 on proposal of the federal agriculture ministry.

Since January 2007, exporters have managed to book orders of around 100,000 tonnes of wheat but have made shipments of around 50,000 tonnes on slow process of commodity offloading by the Punjab and Sindh food departments and Pakistan Agricultural Storage and Supplies Corporation (PASSCO).

Pakistan banned wheat exports more than three years ago because of poor harvests and rising domestic prices but allowed limited shipment of the commodity after a better harvest this season.

The country's wheat output remained unchanged on year at 21.7 million tonnes in the recently concluded season, and the government has set a target of 22.5 million tonnes for the 2006/2007 crop.