THE OILSEED sector, due to ever increasing consumption of edible oil, has attained critical importance to the economy of Pakistan. The consumption of edible oil rose from 0.3 million to 1.9 million tons during the last two decades.

Total consumption of edible oils in 2000-2001 was 1.95 million tons. Local production accounted for 29 percent of the domestic requirement while the remaining 71 percent of the country’s domestic requirement was met through imports. Steadily increasing demand, meagre and fluctuating domestic production base and every increasing imports are the salient features of Pakistan’s current edible oil situation.

The edible oils are either directly imported or are obtained by crushing imported oilseeds locally. The imported oilseeds are mainly canola and sunflower. Pakistan imports mainly palm oil and soybean. Palm oil mostly from Malaysia, Norway, Singapore, and South Korea and soybean oil from Malaysia, USA, Netherlands, Singapore, Argentina, and Switzerland against cash and grant.

The import bill for edible oil, which was Rs. 2.3 billion in 1979-80, has gone up to Rs40.5 billion ($788 million) in 1998-99. It has increased 18 times in 19 years. this is almost 10 percent of our total import bill. Being the second most important single item on the import list, huge foreign exchange is spent on its import.

In Pakistan, edible oil is extracted from conventional and non-conventional oilseeds. Cotton, rapeseed, mustard, groundnut, and, sesame are conventional oilseed crops and have been grown traditionally in Pakistan. Non-conventional crops such as sunflower, soybean, and safflower were introduced in mid sixties during green revolution but area under these crops is still very small.

Cottonseed and rapeseed & mustard together contribute about 80 percent of total domestic production of over 550 thousand tonnes. Sesame and corn oils collectively contribute a negligible portion of 3 percent while non-traditional oilseed crops (Sunflower, soybean, safflower, and canola) contribute collectively a modest share of 17 percent. Soybean and safflower are rarely crushed in Pakistan.

Over the years the Govt. of Pakistan launched various promotional programmes for oilseed crops especially for non-traditional ones. The Pakistan Edible Oil Corporation (PEOC) was established in 1978, and then dissolved in 1979. A Seed Division was created in the Ghee Corporation of Pakistan (GCP). This Division had the mandate to promote non-traditional oilseed crops, supply the seed, and procure the oilseed produce for processing at GCP - owned ghee units. The Seed Division became defunct in 1991.

The government started a seven-year National Oilseed Development Project (NODP) in 1989 for the promotion of oilseeds, especially non-conventional crops. The project made headway in spite of several bottlenecks. The acreage of the oilseed did not rise to a desirable level despite the best efforts of the NODP. Inadequate arrangements for seed supply and procurement were the major bottlenecks. Now the promotional efforts of the NODP have been sustained, at reduced levels, through the Pakistan Oilseed Development Board (PODB). In spite of sincere efforts by the government, the oilseed situation in Pakistan is not encouraging. Oilseed production statistics are far lower than our potential. There are many factors, which are constraining the depressed situation of oilseeds. Broadly, these can be divided into technical, institutional and marketing constraints.

Technical constraints include adjustment problems in the cropping pattern, non-availability of technological packages for oilseeds, low yield, and high cost of production, eroding profitability of the farmers.

Farmers are facing problems in adjusting the oilseed crops in the cropping pattern. This problem is particularly severe in case of sunflower, which has the potential of becoming future oilseed crop of the country. The sowing time of sunflower and wheat is almost same. Farmers have to make a choice between these competing crops. Owing to better support prices and a comparatively better marketing system existent for wheat, the farmers are switching over from sunflower to wheat oven last couple of years.

Moreover, in the cotton zone, farmers face complexities in growing sunflowers after a cotton crop. These are: a) delays in cotton sowing due overlapping of sunflower maturity period; b) application of extra fertilizer to cotton after sunflower crop; c) greater pest incidence in cotton sown after sunflower and d) reduction in cotton yield when sown after sunflower.

Farmers in general are not properly aware of the production technology related to sunflower and canola, which has negative bearing on their yield level. Cultivation practices are not standardised. Varieties suitable for different regions / locations are not developed. Sunflower and canola may be intercropped with other crops, but suitable varieties capable of adjusting in different cropping patterns have not been developed / identified. Sunflower hull, which is a valuable by product but due to lack of proper outlets for its disposal returns from the crop, are undermined.

The average yield of oilseeds like other crops is very low in Pakistan. It is 750 kg/hectare in case of rapeseed, 1244 kg/hectare for cottonseed, 1810 kg/hectare for sunflower, 1207 kg/hectare for soybean and 1246 kg/hectare for canola.

One of the main contributing factors is that the cost of production for oilseeds is high. In fact, the high cost of production militates against the growers. The expansion of area of sunflower and canola is restricted because of high cost of imported seed and uncertainty about its quality. For sunflower hybrid seed is recommended for cultivation in the country. Entire quantity of seed is imported and its cost is very high. The cost of production of locally developed hybrid seed of sunflower is very low and its yield potential is at par with imported seed but its production is confined to research stations only. Local production of quality seed of canola is meagre. Imported seed is expensive and majority of the growers cannot afford to buy it, which adversely bears upon cultivation and yield of the crop.

Erratic government policies, non-selection of reliable oilseeds and uneven competition with imported oil constitute the institutional constraints. The policy regarding oilseed production has been erratic, with more attention being paid to local production when international prices are high and indifferent when these prices fall. With the result that many farmers, having sustained losses, are compelled to switch over to the cultivation of other crops.

Today’s deficit situation in oils and fats exists because Pakistan could not select, develop and concentrate on reliable oil seeds crop to fulfil the needs of the oils. We depend on single vegetable oil, which is a by-product of our cotton crop. In fact we have relied on our main agri-crops i.e. wheat, sugaracane, cotton and rice etc. Oilseeds crops have been simply ignored.

One discouraging factor for edible oil crops has been uneven competition with imported oil. Pakistan is a peasant’s economy while Malaysian edible oil represents a plantation economy, far richer in resources. Pakistan’s importers play the game for personal advantage, and block advantageous prices for local growers. When the local crop reach the harvesting stage, the price of imported oil is reduced to such an extent that the growers are pushed to the wall. This causes losses to farmers while a limited group of foreign importers make large profits.

Marketing constraints are the main reason for the limited production of oilseeds in Pakistan. The choice of any crop mainly depends on the profitability of the said crop. Although in the past support price system was extended to many oilseed crops but it did not yield the desired results. The support price of sunflower, soybean, safflower and canola was fixed at Rs500, Rs410, Rs350, and Rs500 per 40 kg respectively in 1998-99. Since then it has not been revised upward and now due its obligations under the WTO regime. The government has restricted the support price system to only main crops. There will be no support price for oilseeds in the WTO regime. Prices will be determined on the basis of demand and supply. This will further aggravate the problem of oilseed growers.

In the past, the institutional arrangements for ensuring the support price to the farmers have been inadequate. Due to the absence of govt. purchase centres, farmers were compelled to sell their produce to the middlemen who exploited the farmers by paying low price of their produce, by making undue deductions and by employing delaying tactics regarding payments. In case of sunflower, in the year 2000, on an average, farmers were paid in district Vehri Rs. 417 and in district Sialkot rs. 435 for their produced in comparison to the support price of Rs. 500.

Besides the above constraints in the way of increasing production of oilseeds, earlier reports have also indicated similar handicaps that have held the promotion and development of oilseed crops in general. Brief crop wise listings of these constraints are as under:

General constraints for sunflower include non availability of local hybrid seed, cotton yield losses due to delayed maturity of imported hybrids, high cost and lack of proper storage and drying facilities for imported sunflower seed lack of appropriate technology package for farmers in different agro-ecological zones and losses due to birds.

Constraints for rapeseed mustard include its competition with other winter crops, use of marginal lands, damage by the high level of euric acid, resulting in low demand. The production of groundnut is handicapped by the non-availability of short duration varieties, lack of rhizobium inoculum, damage by rats and wild bears, fluctuating market prices and high harvesting costs etc.

Late maturing varieties for soybean are not suitable for cotton-soybean-cotton rotation. Lack of proper marketing system, non-availability of seed and rhizobium inoculum are other factors constraining the development of soybean in the country. Similarly, production of safflower is constrained by lack of suitable varieties, long duration maturity, spiny nature of the crop and competition with winter crops. Owning to paramount importance in the agriculture-based economy, the government must devote serious attention to the oilseed sector, if the object is to save precious foreign currency. For that reason, the government must activate and encourage research institutes to find the causes of low yield, and to develop needed technology packages for oilseed crops. Efforts should be geared towards local production of hybrid seed at low costs.

Instead of paying attention to so many oilseed crops, concentration should be on promoting sunflower and canola. The Agricultural Extension Department should disseminate knowledge to the growers about the production technology of sunflower and canola through pamphlets. Due to non-availability of a price support system for oilseed crops under the WTO regime, the government should endeavour to establish and strengthen market mechanisms and act as a watchdog to safeguard the interests of the farmers. Besides this, the private sector should also be encouraged to boost up agriculture sector, if we are to compete in the coming era of intense global competition.