Pakistan Wheat: Romania Makes a Debut
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Wheat continues to be one of Pakistan’s four main agricultural crops, along with rice, cotton, and sugarcane. Regarding its contribution to food security and area grown, Wheat is Pakistan’s most important crop. The 9 million hectares of Wheat area is about 40 percent of the total field crop land. In irrigated areas, Wheat is planted after cotton, rice, and sugarcane, while in rainfed regions, Wheat is grown at the same time as corn and millet. In terms of Wheat area size, Punjab leads other regions with 6.6 million hectares (73%), followed by Sindh with 1.2 million hectares (13%), KPK with 0.8 million hectares (9%), and Baluchistan with 0.5 million hectares (5%).
Pakistan’s Wheat production is forecast at 26.4 million tons for the marketing year (May/April) (MY) 2022/23, four percent lower than last year due to lower area and reduced fertilizer application. Area and yield expectations are lower as farmers faced both shortages and higher-priced inputs at planting and during crop development. Unavailability and high prices of nitrogen fertilizer led to an estimated 8 percent reduction in fertilizer application.
Reports from the region indicate the low incidence of locusts along traditional local pathways, implying a low risk of locust infestations through the end of harvest. While the Wheat crop has traditionally been susceptible to rust, the increased use of rust-resistant varieties limits the risk, and the disease is reportedly an insignificant factor this year.
Consumption in 2022/23 is forecast at 27.6 million tons, an annual growth rate of 1.5 percent, just below population growth. Growth in consumption of Wheat flour-based products is slowing as incomes rise, and consumers shift to higher protein consumption. Nonetheless, Wheat continues to be the main staple, accounting for 72 percent of Pakistan’s daily caloric intake, with per capita consumption of around 124 kilograms (kg) per year, one of the highest in the world.
Out of the total demand of 27.6 million tons, only five percent will be used in the feed industry. In line with overall higher global prices and driven by the increase in the government Wheat procurement price, in 2021, domestic Wheat flour prices increased by about 20 percent. The government increased the Wheat support price for the 2022/23 crop to Rupees Rs. 1950 per 40 kilograms ($290 per metric ton) from last year’s level of 1800 per 40 kilograms ($281 per metric ton).
Pakistan’s Wheat Import
To make up for the expected domestic shortfall, 2022/23 Wheat imports are forecast at 1.5 million tons. Only a moderate increase in Wheat-based product consumption is forecast as diets gradually shift to more protein and less carbohydrate. The 2021/22 Wheat import estimate was 2.0 million tons, with most Wheat imports sourced from Ukraine. As per AgFlow data, Russia led Pakistan’s Wheat import market with 0.35 million tons in Jan – Oct 2022, followed by Romania (0.35 million tons), Ukraine (0.16 million tons), Bulgaria (0.15 million tons), and Brazil (0,11 tons).
Most of the imports are done by the Ministry of Commerce’s Trading Corporation of Pakistan (TCP), with purchases executed through public tenders. In 2021/22, the bulk of the Wheat imports came from the Black Sea region; the ongoing instability in that region will cause TCP to change purchasing patterns in 2022, potentially creating an opportunity for U.S. Wheat.
Pakistan did not import U.S. Wheat during the last decade due to prices and freight costs. While neighboring India has an exportable surplus, Pakistan is unlikely to import Wheat from there due to the suspension of trade relations between the two countries. Pakistan traditionally does not start importing Wheat until August, after full knowledge of the domestic crop and overall supply situation.
Other sources: https://www.usda.gov
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