High input costs to adversely impact wheat output
ABDUL RASHEED AZAD
October 25, 2012: The domestic wheat production is expected to decline during Rabi Crop Season 2012-13 on the back of high input costs, officials and agriculture experts said on Wednesday. They said that growers were not ready to dedicate additional land for wheat sowing because of surging prices of fertiliser, electricity and diesel. Therefore, Pakistan is estimated to produce 23 million ton of the food grain in 2012-13.
Pakistan has harvested bumper wheat crops for the past four years, with an all-time high production of 25.21 million tons in 2010-11, while in 2011-12 it produced 23.52 million tons. Wheat is not only the major staple food grain but also a food security crop of Pakistan. Being a very sensitive commodity, a small change in its price and availability has considerable impact on consumers, especially poor sections of the community. Hence the government remains concerned with its supply and demand situation to ensure the availability of this basic food item.
The government increased wheat support price from Rs 950 per kg to Rs 1,050 per 40 kg, the farming community is continually complaining about the unprecedented increase in input costs, said an official of Ministry of Food Security and Research. He said that growers had been asking the government to fix wheat support price at Rs 1,300 per 40 kg. According to the official, the total usage of urea in the agricultural sector is 130 million bags, of which 40-45 million bags are used for wheat crop. Yield can be increased by increasing the use of DAP
“During last three years wheat prices increased by 61 percent – from Rs 650 per 40 kg to Rs 1,050 per 40 kg, but the cost of production has increased by 100-300 percent. Urea prices increased by 140% – from Rs 740 to Rs 1,800 per 50 kg bag; DAP prices increased by 281.81% – from Rs 1,100 to Rs 4,200 per 50 kg bag; pesticide prices increased 140.90% – from Rs 110 to Rs 265 per bottle.
Electricity prices per unit increased 116.6% – from Rs 3 to Rs 6.5 per unit for the agricultural sector. Diesel prices witnessed a three time increase in price – from Rs 38 per litre to Rs 113 per litre and seed prices increased by 90% from Rs 1,000 per 50 kg bag to Rs 1,900 per 50 kg bag,” official said. Chairman of the Agri-Forum Pakistan Ibrahim Mughal said that there have been floods in major parts of the country for the past three years, increasing the soil fertility, resulting in better yields.
He said that because of high input cost, growers were not bringing additional area under wheat cultivation, adding that farmers were expected to bring 20 million acres under wheat cultivation against 22 million acres where wheat should be cultivated. Mughal said that wheat production could also fall because of mismanagement. He said that Pakistani farmers were getting much lower prices for their crop against the cost of production, which stands at Rs 1,200 per 40 kg, while the government announced wheat support price of Rs 1,050 per 40 kg. Farmers have urged the government to up the support price to Rs 1300 per 40 kg.
“If we compare India’s yields, wheat prices and cost of production with Pakistan then figures speaks louder than words. Urea prices in India are 600 Pakistani rupees per 50 kg bag, DAP prices are equal to 1160 Pakistani rupees per bag and diesel prices are equal to 74 Pakistani rupees per litre. The buying price from the farmer in India is equal to 1000 Pakistani rupees /maund,” Mughal said. “India is providing 812 billion rupees as subsidy to agricultural sector. Per acre yield in Indian Punjab is 43 maund.”