Impending wheat crisis

ByElsa Sc S

Doing her graduation from LUMS & a keen researcher


June 1, 2022

Impending wheat crisis

Elsa Sc S draws attention towards a serious issue

Pakistan is now facing the grim prospect of an Impending wheat crisis shortage and the cash-strapped country may be badly affected by it. As the situation stands Pakistan is not only required to arrange for the subsidies granted to fuel and energy sectors but it is now under tremendous pressure to arrange funds for importing wheat in the near future. If the government fails to arrange for these extra funds then it will be constrained to increase the price of wheat flour that may well prove the proverbial last straw on the camel’s back. With inflation running on exceptionally high levels it would be very difficult to handle such a situation.
It is reported that Pakistan is expected to obtain only 26.9 million tons of wheat this season against a target of 28.9 million causing a serious shortfall of 2 million tons. The wheat crop was badly affected by poor utilisation of fertilisers and then early heatwave in March shriveled wheat grains. One potent cause was the scarcity of water that is reported to have given rise to interprovincial discord between Punjab and Sindh. It could be clearly observed that this shortfall may prove disastrous as the country requires some 30.8 million tons and even after utilising carryover stock of one million tons the gap of some 3 million tons remains.
It is reported that the current prices for wheat have risen the world over as the prices of US wheat has gone up to $495.28 per ton in the international market representing over 39 per cent increase in price as it was $354.67 per ton last October. At that rate, the purchase price of wheat comes to around Rs.99,100 per ton or Rs.99.1 per kilo that would skyrocket the prices of wheat flour. Currently, the retail price of wheat flour is Rs.68 per kg and the government will be required to subsidise the cost of imported wheat that would come to Rs.99.1 per kg. It is accordingly estimated that Pakistan would need $1.5 billion to meet this situation and this is extremely difficult for the government to arrange such kind of money.
In this connection it must be kept in view that the price of wheat flour was already up 18.34 per cent on a year-on-year basis in April for urban consumers and 18.82 per cent for rural consumers. The month-on-month increase in prices in April over March was 0.63 per cent and 3.45 per cent, respectively, for the two categories of consumers. In this condition Pakistan would prefer to import wheat from Ukraine but the Russian-Ukrainian conflict has hampered wheat exports from Ukraine due to Russia blockading the Red Sea region from where Ukrainian exports took place. These factors, coupled with higher fertiliser costs and weather worries, are compounding disruptions in the global supply chain and bringing grain prices further under pressure.
In this context it is mentioned that such shortage is akin to the concept of food insecurity and it is a pity to note that Pakistan already ranks 92 on the index of Global Hunger Index consisting of 116 countries. The reports are already circulating that food insecurity situation is currently prevailing in some areas of Balochistan, Sindh and KP due to severe drought and inadequate rainfall in the country. Meanwhile, the war in Ukraine is also having an indirect impact on food availability in the country as around 60 per cent of the wheat consumed in Pakistan was imported from Ukraine in 2021-22. In the wake of this situation it is estimated that that food insecurity in Pakistan may reach 38 per cent in the next decade.
Food insecurity is currently experienced the world over and Pakistan is seriously affected by it as not every one is fortunate enough to consume three meals a day let alone meeting dietary requirements for normal life. The result is that Pakistani children and women are nutritionally deficient that comes with the risk of falling victim to diseases and live a weakened life. There is no one-size-fits-all methodology to handle food and nutritional insecurity. A consistent multi-sectoral app¬roach is needed such as encouraging the agriculture sector and subsidising tax on the latest types of machinery and technologies to increase sustainable production and get bumper yields to avoid the import of grains.
In Pakistan, not only poverty but political and economic instability, natural disasters and low agricultural attainments have shattered many sectors of human development in the region, aggravating the crises in crucial sectors of health and education. In this connection, subsidising healthy food items and providing an uninterrupted food supply to the population will help mitigate the acute food insecurity while also reducing nutritional inadequacies. There is hardly any need to emphasise that the huge economic and human damage inflicted due to the food inadequacy and poverty needs to be reversed. There is a dire need for effective measures and sustainable nutritional goals to restore food security in the current global situation. TW

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