April 10, 2006	Monday	Rabi-ul-Awwal 11, 1427

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MULTAN, April 9: An analysis of the last year’s figures regarding wheat production, carryover stock, official procurement and import of the commodity creates doubts about the output of 21.6m tons projected by the ministry of food, agriculture and livestock for the year 2005.

A difference of as much as 1.7m tons of wheat pops up when one carries out the mathematical analysis of the official figures. There was a carryover of around 0.2m tons of wheat in the official godowns when harvesting of the fresh crop was kicked off last year.

When the official wheat procurement ended, the stock position of the provincial food departments and the PASSCO in tonnage on Aug 28, 2005, was: Punjab, 2.490m (including 0.052m carryover); Sindh, 0.540m (including 0.037m carryover); NWFP, 0.056m; Balochistan, 0.022m; and PASSCO, 1.124m (including 0.126m carryover). Thus, the government had a total of 4.232m tons of wheat in its godowns at the end of the season last year.

The Minfal had set up a production target of 22m tons; at par with the officially estimated consumption of 22m tons of wheat, including 0.6m tons believed to be transported to Afghanistan. The Minfal, however, put the wheat production for the year 2005 at 21.6m tons, showing a shortfall of 0.4m tons.

Consequently, an excuse to import wheat was offered by the pundits at the food wing of the Minfal in the name of bridging gap between demand and supply and to maintain a strategic carryover stock of 0.4m to 0.5m tons at the time of next harvesting. Thus, as much as 0.863m tons of wheat was imported in the country in the year 2005-06. The quantity of wheat available in the country, therefore, becomes 22.663m tons after adding the imported wheat to the Minfal-projected 21.6m tons of domestic wheat production.

Keeping in view the available quantity of wheat as against the estimated consumption, the carryover in the official stocks must not be more than 0.6m tons. But, it is being said officially that the carryover in the official godowns by April 1st this year has been 2.3m tons. So, from where the remaining 1.7m tons of wheat has come?

The market analysts say that it seems that the wheat production for the year 2005 was projected low purposely to get a green signal for wheat import under the pretext of a crop size less than the desired production. The federal government, they say, took a timely decision to discourage the alleged ‘commission mafia’ by allowing wheat import in the private sector rather than doing the task through state-run Trading Corporation of Pakistan. It may be added here that the private importers struck deals with the foreign wheat sellers at prices that remained around $140 per ton while prices of the commodity having same specifications had been around $200 per ton when the TCP was handling the import.

Ironically, the Federal Committee on Agriculture, in its meeting held on April 4, trimmed down the earlier wheat production target of 22m tons for the year 2006 by 7 per cent to 20.5m tons despite a 1.6 per cent increase in the area that came under wheat as compared to the corresponding year. The wheat was sown over an area of 8,364,000 hectares in the Rabi season 2005-06 as against 8,234,000 hectares sown in 2004-05.

The FCA meeting chaired by federal agriculture minister Haji Sikander Hayat Bosan made a conservative estimate of the crop when on the same day Dr Ishfaq Hasan Khan, a federal finance ministry bigwig, in an interview revealed that India had made an offer to barter wheat for its sugar. He, however, made further deliberations on the offer conditional to the estimates of wheat crop size for the year 2006.

Earlier, there were reports that the Minfal had also reduced its estimates about domestic wheat consumption from its previous estimate of 22m tons without assigning any particular reason, especially when the country ‘boasts’ of its high population growth rate.

More cynic of the analysts are seeing the drastic reduction in estimates of wheat production a bid to forestall the prospective deal between Pakistan and India over latter’s ‘wheat for sugar’ offer. And their skepticism cannot be termed out of place keeping in view the bruised credibility (if there any) of the National Accountability Bureau at the hands of powerful ‘sugar mafia’.

Analysts say that for the sake of transparency the Minfal should make public its wheat stock balance sheet for the last three years.