Govt depts defer wheat purchase

April 23,2019

LAHORE: Public sector procurement departments have postponed wheat the procurement drive in the province, leaving farmers at the mercy of private buyers in the market.The Punjab Food Department on...

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LAHORE: Public sector procurement departments have postponed wheat the procurement drive in the province, leaving farmers at the mercy of private buyers in the market.

The Punjab Food Department on Monday failed to formally start the wheat procurement campaign and deferred it until April 25 on the pretext of high moisture contents in the fresh arrivals. The same is the case with Pakistan Agricultural Storage & Services Corporation (PASSCO) that has suspended distribution of gunny bags to farmers till April 29. The provincial Food Department was scheduled to formally launch the wheat procurement campaign from April 22, with the distribution of gunny bags among farmers. However, without any announcement, the provincial government halted the purchase of grains, leaving growers high and dry in the open market dominated by voracious private buyers.

Wheat procurement has been postponed in Bahawalpur, Lodhran, Rahim Yar Khan and adjoining districts of Southern Punjab till Aprill 25 while it will commence in Khanewal and adjoining districts as late as April 29. The Provincial Food Department has not yet given any date for the rest of the districts. It is feared that issuance of gunny bags in central and northern districts may be delayed to next month.

It is learnt that the provincial Food Department has written a letter to district administrations for seeking advice on beginning the procurement campaign in their respective district in view of losses to standing crops due to the inclement weather.

Nonetheless, wheat has matured almost in every district of the province and harvesting has also been initiated from Southern to Central Punjab. Arrival of grains from the new crop started picking momentum in southern Punjab districts.

However, the absence of the Food Department leaves a negative message in the market. Resultantly, much to the dismay of farmers, wheat prices have been seen much lower in the open market if compared with official support price of Rs 1,300 per maund or 40 kg.

The average price in open market of most of the southern Punjab districts is stated to be in the range of Rs 1,150 per maund. In some districts including Bahawalnagar, the price of wheat being offered to farmers was as low as Rs 1,050 per maund. Rates being offered to farmers in Bahawalpur on Monday range between Rs 1,100 and Rs1,165 per maund while in Bahawalnagar wheat hovered around Rs 1100 to Rs 1250 per maund. In this grim market situation, fears of growers are increasing. Their fears mainly stem from the absence of public sector buyers whose primary responsibility is to intervene in the market by purchasing the commodity. However, they have yet failed to do so.

Unlike previous years, both federal and provincial wheat buying departments are facing relatively lesser constraints this season as most of their stock has been disposed of. Currently, Punjab has only 1.7 million ton carryover stock, which is almost half of what the Food Department had to keep these days last year. Lesser carryover stock means lesser liabilities and more space for storing new grains. In these favourable conditions, it is not comprehensible that why the provincial Food Department is reluctant to start wheat procurement?

The Punjab government buys around 40pc of the marketable surplus of wheat every year with the sole aim to stabilise the market price. The Punjab Food Department has made arrangements for procuring 4million ton wheat this year while PASSCO’s nationwide target has been set at 1.1 million ton.


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