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The agricultural sector is one of the largest contributors to the economy. While declining as a proportion of GDP, agriculture still contributes one-fifth of Pakistan’s wealth and almost half the population depends directly or indirectly on agriculture for their livelihoods. With 79.6 million acres of arable land, there is a great potential for improving efficiencies and productivity of the agriculture sector. The crop sector is an important sector of the economy which provides food to rapidly growing population of the country. The major crops consist of six main crops: wheat, rice, sugarcane, maize, chickpea and cotton. Wheat is Pakistan’s largest crop, in terms of area sown and is grown under different agro-ecological zones. Wheat flour currently contributes 72% of Pakistan’s daily caloric intake with per capita wheat consumption of around 124 kilograms (kg) per year, one of the highest in the world. In irrigated areas, wheat is planted after cotton, rice, and sugarcane, while in rain fed areas wheat is grown at the same time as maize and millet. The sowing of wheat takes place from October to December and harvests from March to May. Approximately 80% of farmers grow it on an area of around 9 million hectares (close to 40% of the country’s total cultivated land) during the winter.
Wheat is the most widely grown crop in the world. Wheat (Triticum aestivum) is one of the first domesticated food crops and has been the basic staple food of the major civilizations of Europe, West Asia and North Africa for last 8000 years. Approximately one sixth of the total arable land in the world is under wheat. It is most demanded food grain and its production leads all crops, including rice, maize and potatoes. In Pakistan, wheat being the main staple food cultivated on the largest acreages. Pakistan falls in ten major wheat-producing countries of the world in terms of area under wheat cultivation, total production and yield per hectare. Wheat is the essential diet of population as it constitutes 60% of the daily diet of common man in Pakistan and average per capita consumption is about 125 kg and occupies a central position in agricultural policies of the government. Based on cropping pattern, disease prevalence and climate, Pakistan has been divided into a ten production zones. However, production zones need to be revisited. In Pakistan, wheat is grown in different cropping systems, such as; cotton wheat, rice wheat, sugarcane wheat, maize wheat, fallow wheat. Of these, Cotton-Wheat and Rice-Wheat systems together account about 60% of the total wheat area whereas rain-fed wheat covers more than 1.50 m ha area. Rotations with Maize-Sugarcane, Pulses and fallow are also important.
Pakistan’s growing population is seeing an increased demand for wheat. However, the production of the commodity is not rising at a proportional rate. Pakistan’s 2020-21 marketing year wheat production is expected to decrease to 25.2 million tons due to the impact of untimely rain at harvesting. Despite having fertile lands and bumper wheat crops, Pakistan had to import four million tons of wheat last year. South Asian country has undergone a historic shift from being an exporter of wheat to a major importer of wheat. Agricultural experts of Pakistan have called upon the government to impose a ban on wheat exports of local grains amid serious repercussion of the Russia-Ukraine war, which will disrupt the supply of wheat in the international market. A farmer’s lobby group, has suggested the government to maintain wheat stocks through procurement during the on-going harvest and put a stop to wheat exports. It should be noted that Ukraine is the third largest exporter of wheat, holding at least 12% share in the global export market for the staple grain. The war in Ukraine will push the prices higher and opportunists might sell off the food security to fill their coffers. The escalating tensions between Russia and Ukraine will have a serious economic fallout, effects of which have already started to show in Pakistan. Local prices of gasoline, food, commodities, and steel and semiconductor chips are witnessing a major increase. Pakistan is the seventh-largest market in the Middle East, African, and South Asian regions, as measured in Purchasing Power Parity (PPP). It has the second-largest economy in South Asia, after India. The economy has been growing slowly over the past two decades. However, the containment measures adopted in response to the COVID-19 pandemic led to a severe contraction in economic activity.
Pakistan has bought wheat regularly in the global market in recent months to boost domestic supply and cool prices. Pakistan’s MY 2020/21 wheat imports are estimated at 3.4 MMT. MY 2021/22 wheat imports are forecast at 1.0 million metric tons (MMT). Almost all wheat imports during the current marketing year are being sourced from Russia and Ukraine. Consequently, all wheat imports are currently entering duty-free. Due to lower area and yields, wheat production in 2022/23 is forecast at 26.4 million metric tons (MMT), four percent lower than last year. To make up for the expected domestic shortfall, in 2022/23 wheat imports are forecast at 1.5 MMT. Rice production is forecast at record 9 MMT, which will drive exports to a projected 5 MMT. Benefitting from imported U.S. seed, corn production is forecast to reach another production record of 8.9 million tons in 2022/23. Due to expectations for a 2% decline in harvested area and slightly less average yield, wheat production in 2022/2023 is forecast at 26.4 MMT, about 3.6% lower than 2021/22. Area and yield expectations are lower as farmers faced both shortages and higher priced inputs at planting and during crop development. Unavailability and/or high prices of nitrogen fertilizer led to an estimated 8% reduction in urea fertilizer application. However, growing conditions were generally good, with adequate rainfall during key crop development stages in January and February. The good growing and adequate moisture conditions should boost yields higher than otherwise indicated by the lower fertilizer usage rates. While the wheat crop has traditionally been susceptible to rust, the increased use of rust resistant varieties limits the risk, and the disease is reportedly an insignificant factor this year. Consumption in 2022/23 is forecast at 27.6 MMT, which is an annual growth rate of 1.5 percent, just below population growth. Growth in consumption of wheat flour based products is slowing as incomes rise and consumers shift to higher protein consumption. Nonetheless, wheat continues to be the main staple, accounting for 72 percent of Pakistan’s daily caloric intake with per capita consumption of around 124 kilograms (kg) per year, one of the highest in the world. Out of the total demand of 27.6 MMT, only five percent will be used in the feed industry.
Pakistan’s population growth is among the fastest in the world and domestic wheat production and yields have not increased. Over the past few years, Pakistan’s wheat production has not increased at a rate to suffice local demand shifting the country from a wheat exporter to a wheat importer. The change is due to climate change, lack of high-yielding research and minimal increase in support prices, lack of investment in research for developing high-yielding varieties, and minimal increases in the support.
School of Management and Economics,
Beijing Institute of Technology, Beijing, China.