August 23, 2020

 

Pakistan imports wheat to address local market challenges

 

 

Following Pakistan's recently completed crop fell below expectations, the country placed the biggest purchase among global importers, Moree Champion reported.

 

The USDA increased import estimates from 0.01 million tonnes to one million tonnes, but further increases are expected if recent reports out of Pakistan prove correct.

 

Global wheat production and consumption estimates for the 2020-21 season were updated by the USDA last week—and the changes were broadly in line with market expectations.

 

The USDA reduced its total grain production forecasts, as smaller crops in the EU, Kazakhstan, Argentina and Turkey more than offset larger crops in Russia and Ukraine.

 

Global consumption estimates were lowered, mainly due to feed and residual use for the EU. Exports were raised for Russia, Ukraine, and the US—but reduced for the EU.

 

The Pakistan government estimates final wheat production ended up at 25.5 million tonnes, which is slightly above the five-year average of 25.3 million tonnes. That represented a 1.2 million tonnes increase on the 24.3 million tonnes harvested in 2019, but was well short of the government's target of 27 million tonnes.

 

Wheat is one of the four main crops in Pakistan—alongside rice, cotton, and sugarcane—and is grown during the 'Rabi' (or winter) season by about 80% of the country's farmers.

 

The planting season commenced on time in October last year, and the area planted was expected to be 9.2 million hectares—about 40% of the country's arable area.

 

But soaring costs of production and a low government support price discouraged some farmers from planting, and the area finished up at around 8.5 million hectares.

 

Early crop development was excellent on the back of favourable weather conditions. But heavy rains and localised hail over areas of the leading wheat-producing province of Punjab in March and April delayed harvesting operations and caused localised damage to standing crops.