September 27, 2004

Wheat Support Price In Pakistan May Rise

The Pakistan federal cabinet is expected to increase the support price of wheat in its upcoming meeting next week, an official said on Saturday.

The ministry of food and agriculture has proposed new support price of wheat at Rs 400 per maund for the coming crop, he said. He said that the planning commission, ministries of commerce, industries and production have supported increase in the support price of wheat, while the finance ministry is also expected to submit its recommendation before the meeting of the cabinet.

He was optimistic that the new support price of wheat could be fixed by the federal cabinet between Rs 370 to Rs 380 per maund.

The new support price of wheat would be close to the existing open market price of the staple food that is fluctuating between Rs 390 to Rs 400 per maund.

The official said that increase in the support price of wheat would encourage the bumper production of wheat in the years to come. "At present the agricultural prices commission (APCOM) has worked out Rs 340 actual cost of production of wheat per maund in the country."

In other words the government is paying only Rs 10 per maund to farmers as incentive, which is very low. As a result, the support price of the staple food is being further enhanced to ensure a fair return to the growers, he said.

The shortfall in the production of wheat faced by the country is attributed to the shortage of water, unattractive support price of Rs 350 per 40-kg as well as heavy rains at the time of the harvest of the crop. The official said increase in support price of wheat would motivate the farmers to grow more wheat by arranging water from their own resources such as tube-wells, and pumps. The farmers would also be able to utilize better percentage of inputs like fertilizers and seeds, he added.

In 2003-04, the country has produced 19.6 million tons of wheat as against the required 21 million tons for domestic consumption, including one million tons buffer stock. The federal government has imported wheat this year to meet consumption requirement.