Friday, December 26, 2008
By Jawwad Rizvi
LAHORE: The agriculture sector has encountered difficulties during the year 2008 following a surge in international food prices and due to poor planning of the previous government.For sustainable agriculture growth, long-term policies are crucial but the previous government neglected the fact that Pakistan is an agrarian economy which plays a vital role in its growth and put the sector on the backburner.The sector faced worst-ever fertiliser crisis in the history of the country during the current calendar year. On the other hand, farmers were deprived of the benefits of their produce while middleman mafia minted money from the trade of foodgrains and fertilisers.Round the year, the farmers faced huge difficulties in getting fertiliser as they did not get di-ammonium phosphate (DAP) in Rabi season and in Kharif season they were struggling to find urea. In this whole episode, the middleman smuggling mafia, which had been involved in a flour crisis earlier, remained active and smuggled fertiliser, sending prices to historic highs in the range of Rs3,100 to Rs3,300 per bag of DAP.Price differential between DAP and urea discouraged farmers from purchasing DAP. Previously, the price difference was double which has now increased to five times. DAP has risen to Rs3,100-Rs3,300 per bag while urea is being sold at Rs650-660 per bag. Still over three lakh tonnes of DAP is available, but farmers are reluctant to purchase.Earlier, the year started with a flour crisis when international food prices swiftly rose, triggering smuggling of flour from Pakistan to Afghanistan and Central Asian States due to the price differential between local and international markets.The country recorded a big fall in wheat production at around 21 million tonnes compared to the target of 23.5 million tonnes. After production decline, the newly elected provincial governments took administrative measures in a bid to stop illegal movement of wheat. The Punjab government raided godowns where millions of rupees worth of wheat was hoarded by middlemen.Despite those administrative measures, the federal government decided to import wheat to meet domestic food requirements as local output fell below target. It planned to import 2.5 million tonnes of wheat out of which around 1.8m tonnes had been imported so far at an average price of $400 per tonne, putting an extra burden on the kitty at a time of financial crunch.Other major crops also faced a disappointing scenario during 2008 due to poor marketing and administrative steps of both the provincial and federal governments. Rice prices, for the first time in the history, rose to a high of Rs150 per kg, but it encouraged farmers to grow more rice leading to a bumper crop of 6.4 million tonnes during the year.However, the farmers failed to get minimum prices due to an improper marketing mechanism and poor administrative measures. The government brought in Pakistan Agriculture Storage and Services Corporation (PASSCO), but targeted results could not be achieved. This situation may disappoint farmers and cause a fall in rice production next year.On the other hand, the middleman mafia was active in paddy procurement areas and it seemed this time again consumers would pay high prices of rice despite a bumper crop and growers would also suffer.Cotton is one of the major crops and provides raw material to one of the largest industries, which is textile. Around 12.6 million bales have been produced this year compared to last year’s crop of 11 million bales. However, growers did not receive actual return on their produce because of delay in fixing minimum price of cotton by the government and lethargy of Trading Corporation of Pakistan (TCP) in the procurement drive.Cotton production has failed to take a quantum leap in recent years due to viral attacks, mealy bug and cotton leaf curl virus, which could not be prevented this year too. Besides that, no breakthrough has been made in the introduction of BT and hybrid seeds of cotton which seem to be crucial to boost cotton production and reduce dependency of farmers on pesticides to protect their crop from pest attack.Sugarcane crop also registered a decline this year due to which sugar output would also be lower. The country is expected to produce 4.3 to 4.4 million tonnes of sugar compared to consumption of 4.7 to 4.8m tonnes, showing a shortfall of four lakh tonnes. To cover the gap, the TCP has 4.5 lakh tonnes of sugar in stocks while millers have 2 lakh tonnes in their godowns.The performance of minor crops is also not much encouraging, though the sunflower crop has recorded a remarkable increase due to a surge in international palm oil prices. Local ghee and cooking oil producers offered handsome prices for sunflower, which encouraged the farmers of cotton belt to grow it.Water scarcity has remained an issue this year too. The country faced acute water shortage both during Rabi and Kharif seasons, causing an irreparable damage to per acre yield of different crops. Because of canal water shortage, the growers increased their dependency on tube-wells, triggering issues of salinity.Irrigation of land through tube-well water also escalated the production cost for farmers as they ran their tube-wells on diesel due to long-hour power outages and unannounced loadshedding.The federal government has not so far made a positive change in its policies for the agriculture sector. International forecast of a sharp fall in food prices may create problems for growers who sow more on hopes of getting good prices.
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