AS Punjab prepares for wheat harvesting next week, a sense of optimism has gripped farmers and policymakers alike. Both feel that achieving the target of 19.50m tonnes should not be a problem, despite a setback in the rain-fed areas and a slight fall in acreage.

These negative factors, they believe, have largely been neutralised by the huge jump in fertliser off-take, and weather, by and large, being favourable for the crop.

The sowing and germination processes in the barani (rain-fed) farmlands, almost form 12pc of the total wheat area of the province, have been affected by persistent drought.

With more application of subsidised fertiliser, the average per-acre yield of wheat has increased from 29.95 to 30.54 maunds

Drought persisted right up to tillering, until the January rains brought some relief.

However, according to the early assessment, it may have cost a 25-30pc loss in production. These areas contribute just over 1.5m tonnes. The loss of an estimated 0.5m tonnes would surely be compensated by the output recovery from irrigated areas.

This season, the province has sown wheat on 16.68m acres, against the target of 16.80m acres. Last year, total sowing was on 17.08m acres.

The jump in fertiliser application may prove crucial to boosting output. In the first four months of this season (Oct-Jan), urea application went up by a whopping 27.50pc — owing mainly to the official subsidy package, which brought down its price to Rs1,400/bag.

In the same way, the DAP application increased by 12.20pc over the same period. This increase was over and above 36pc DAP use last year. Since the subsidy on DAP started a year earlier than urea, farmers availed it much more and reaped the benefit with a slight increase in the provincial average yield per acre from 29.95 maunds to 30.54 maunds.

The only concern that the farmers now have is the crop’s procurement issue, especially given the robust crop size. Punjab is still to come up with any procurement plan.

Another source of growers’ concern is the carryover stocks of around 3m tonnes. If another 4m tonnes are added to the tally this season, it would become a huge financial burden for the provincial government, which will also need to look for more storage facilities.

The third source of concern for farmers is the uncertain government policy. A World Bank team recently held meetings with farmers in Punjab to assess the possible scenario in case the provincial government reduces its role in procurement. Punjab has not clarified its position. Reported substantial crop size only adds to their fears about the procurement policy yet to be announced.

Published in Dawn, Business & Finance weekly, March 27th, 2017