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June 20, 2019

Wheat price hike: Govt to release PASSCO stocks to end wheat hoarding, contain price


June 20, 2019

ISLAMABAD: Owing to increasing wheat price by hoarders in the market, the government is considering asking the state-run Pakistan Agricultural Storage & Services Corporation (PASSCO) to release some wheat from stocks to end the artificial price hike, the News has reliably learnt.

“Yes, the Minister for National Food Security and Research and the representatives of provinces were of the firm believe during a Wheat Review Committee’s meeting that the higher authorities should give this permission for early release to kill the deliberate price increase of wheat in the market, as hoarders have become active now,” official sources told The News Wednesday.

The Committee met here with Minister for National Food Security & Research Sahibzada Mehboob Sultan in the chair here Wednesday. The committee was informed that total wheat production during 2018/19 in all provinces stood at 24.279 million tons, while earlier reserves were 3.721 million tons making the total availability at 28 million tons, which is far more than country’s total requirement of 25.8 million tons.

PASSCO Managing Director Muhammad Khan Khichi when contacted, told this correspondent that the government is thinking over releasing some stocks from the PASSCO to curb the price hike. However, he added that smuggling to Afghanistan was one of the major challenges.

He said that so far in new season, PASSCO has procured 0.7 million tons of wheat. In last three years, the procurement was 0.9 million ton each year. He said that this quantity has been procured from Sindh, Balochistan and Punjab. Owing to good quality of wheat in Sindh and Balochistan, we procured more than targets, but in Punjab the procurement was less than the target because of the quality of wheat that affected by rains and rust.

He further said that current stocks with the PASSCO stands at 1.9 million tons that consist of 0.7 million new procurements while remaining was 1.2 million as buffer stocks.

When asked if the government allows release of stocks from PASSCO, what would be its impact, he said, “It would not affect us as we have sufficient stocks, however, it would contain the price increase and limit it at Rs1300/40kg (government price). We can also provide the wheat to provinces, but especially in KP the flour mills should be made bound not to send wheat and its products to Afghanistan.”

Meanwhile, a news statement issued here by the ministry said that the minister had stressed the need to determine the cause of price variation and upward trend of wheat and put forward concrete solution, one the solutions could be government (s) intervention through release of wheat in the open market to discourage the hoarding for undue profit. Moreover, the minister suggested that one of the measures could be regulation on the export and import of wheat.

Minister was apprised that feed companies are also one of the reasons for apparent shortage and price hike; hence we need more grinding than trading otherwise the dearth may likely to prevail.

Minister also directed that the private sector procurement of wheat must also be assessed, price monitoring system could also be devised and also provincial governments keeping in view the price hike and gravity of situation must release wheat from local stocks.

It was also pointed out that wheat seed requirement for next sowing would be assessed and proper plans be devised for a steady availability of the quality seed from various public and private sources.

Mehboob Sultan reiterated that there must be a crackdown against the hoarders who are responsible not only for price hike but uncertainty in the country or parts thereof.

The meeting was attended by provincial Minister for Food, Punjab, Secretaries and representatives of State Bank of Pakistan; Floor Mills Associations, wheat exporters, representatives of agriculture/food departments of four provinces, GB and AJK, MD PASSCO and senior officials and experts from the federal ministry.

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