December 26, 2003

 

 

Pakistan To Buy 150,000 Tons Wheat

 

The Pakistan Agriculture Storage and Supply Corp (PASSCO), one of the state's two main grain buyers, will buy 150,000 tons of wheat by end of this week, a government official said on Tuesday.

 

"In the first phase, we have decided to import 150,000 tons and an international tender will be issued this week," said a senior PASSCO official, who declined to be identified.

 

"We are working towards offering the tender before the Christmas holidays, but it might be delayed by a day or two because we are in a process of finalising some modalities."

 

The tender will be a move towards the first wheat import by the country in about four years. The country announced in November it would buy about 500,000 tons through international tenders.

 

The imports follow a dry winter spell that damaged the domestic crop. Wheat output was about 19.25 million tons in the last 2002-03 (Nov-April) crop year, short of a target of 19.70 million tons.

 

The country consumes a little over 20 million tons of wheat annually, but government officials say the lower harvest is not immediately expected to affect supply as the country has carry-over stocks of more than a million tons.

 

The government has removed a 25% import duty on wheat, but the removal of duty will only benefit government imports, not those arranged by private traders.

 

The official said the planned imports, aimed at both making up a domestic shortfall and building up strategic reserves, would be completed in four to five phases over the next two months.

 

An official at the food ministry said the tender would be for milling wheat on a C&F and FOB Karachi basis for delivery 45 days after acceptance of bids.

 

"We are in the import market after a gap of almost four years, so we will issue further tenders on the basis of the response we get through the first tender," the official said. The ministry had suggested that PASSCO import wheat from North and South American countries and Australia, he added. The US government offered a loan of $95 million to Pakistan in November for agricultural purchases.

 

The official said Indian wheat would not be accepted. Pakistan banned the import of Indian grain two years ago, saying it was contaminated by Karnal bunt fungus.