While there always are political connotations to the wheat crop, they have been blown out of proportion this year because the supply and availability of the commodity is sufficient
, the crop is of a reasonably good size and the management seems more efficient in Punjab, the main producer of the crop, this year. What then is the fuss about?
Punjab was given the target of producing 16 million tons and the private sector experts, as well as the government officials generally agree that the crop would produce that much and if the produce is in the lower side, the difference may not be significant.
Seeking to procure 3.5 million tons, the Punjab's Food Department is optimistic about meeting the target and the political administration is vocally determined to procure the required quantity. But the administrative method to achieve this end, imposition of ban on wheat's movement has been questioned by other provinces and evoked angry response from them.
They have come up with a strong position against the ban and announced the possibility of taking extraordinary measures if the ban was not removed. The Punjab's administration is however determined to follow its course till, according to official sources, procuring the quantity it considers necessary for ensuring food security for local populace as well as demands of provinces in the coming months.
Things were proceeding smoothly till mid April, in fact the procurement drive was more successful at that time of the year than at any time in the past few years except during the bumper wheat season of 2000-01. Then wheat suddenly vanished from the market. It was at this point, to be exact on April 19, when the ban on wheat's transportation was resorted to.
There seemingly was no reason for the non-supply of wheat in markets because the growers were receiving a fair price and the crop was not in such short supply that farmers could gain any special advantage by holding their produce back. Actually, quick disposal of wheat suited them, for it meant time and resources for the next crop.
Big money and high expectations hit the wheatscape at that stage. Loans from banks at unusually low mark-up - the policy devised for promoting productive investment but turning instrumental in a rake-off operation on wheat fields, entered the scene as a major player and started playing havoc with the price of wheat.
Hoarding of wheat had proved profitable business when investors and speculators purchased the commodity at below official price and managed to sell it high in recent years. Loan facilities from banks made things easier for this segment. Smelling pay dirt rakings, they raised the price a few notches to undermine the Punjab's procurement drive.
While this enabled them to purchase wheat, the enhanced price built expectations of further escalation and farmers who could afford to stock their produce, decided to wait for extracting more financial benefits.
The government tried to counter the private sector buyers by offering transportation costs to match the investor's bid but that did not improve things as the other party tilted the scales further. That set the stage for hoarding, particularly by big landowners. A vicious circle thus started spinning.
There is no count of how much wheat is being currently hoarded but the quantity could be more than half a million tons. More disturbing than the quantity is the trend to hoard because it could prove instrumental in creating an artificial shortage and leave Punjab with an unfulfilled target. In this case, the loss of Punjab would be for the entire country.
At this point in time, it is a question as to who would win the tug of wheat price war, the provincial food department or the private investors who stand to make a quick packet if the official procurement drive flounders. That provincial government insists on maintaining restrictions on wheat's movements to block further hoarding of the commodity and another rate hike.
Punjab had procured nearly 1.5 million tons by end of last week and the target if 3.5 million tons seems within its range. Provincial authorities are confident of procuring at least two million tons before the current month ends. That should put an end to further escalation of price of wheat.
While higher price would place citizens under pressure, the issue has to be seen in a different context. Farmers need to be encouraged to continue cultivating wheat for domestic consumption, as also for export. Shortage means imports at a higher price that would benefit the farming community in foreign lands.
Such imports would be subsidized at the time of their release for local consumption. It is consequently both logical and fair that whatever that financial mileage in wheat, it should go towards the local grower. They have the first claim on a better income from their labour.
Punjab's target of 3.5 million tons is in excess of provincial requirements by a little less than one million tons. The rest is for other provinces. While there has been a hue and cry from other provinces, the Punjab should be viewed as being within its rights to ensure food security for the local populace.
Other provinces can of course do their procurement from Punjab but in that case, the Punjab should not be required to meet their demands at a later stage. This issue needs to be resolved coolly by leaders of all provinces to protect the collective interest of Pakistan's populace.
Matching of oratorical talents is unlikely to produce positive results. In any case, there is little justification for anger from the NWFP because its stocks stood at 90,000 tons at the end of April while Punjab's count was 60,000 tons. Sindh had no stocks while the requirements of Balochistan weren't of a major nature.
As for the availability of wheat during the rest of the year, prospects look promising for that because reports inform of tighter controls over borders that have served as routes for smuggling.
The campaign against terrorism has been a controversial blessing in disguise because it has forced the government to man the porous borders more vigilantly. The volume of smuggling is expected to be lower in coming months and that augurs well for wheat security in the country. It is an end requiring support from all players rather than a subject for political one-upmanship and creating additional complications.
