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Event Title: The Senate Standing Committee on National Food Security and Research

Event Date: 2020-02-04

The Senate Standing Committee on National Food Security and Research in its meeting on Tuesday at Parliament House, discussed in detail the wheat crisis and those responsible for it.  It also deliberated over issues related to hoarding and smuggling of wheat in the country.    

The Committee was informed that a high powered Federal Committee on Agriculture (FCA) in its meeting held on 11 October, 2018 fixed wheat production at 25.51 million tons from an area of 8.8333 million hectares.  However, at the final stages of crop maturity, heavy rainfall, hailstorm and wind lowered the production to 24.479 million tons.  This caused a production loss of around 5 percent. 

Overall availability of wheat was at the level 28.256 million tons, including production of 24.479 million tons and leftover stock of 3.777 million tons as compared to the national requirement of of 26.91 million tons (including 10 percent stock on account of strategic reserves seed and feed purposes).  Current wheat stock of the public sector as on 29-01-2020 is reported at the level of 3.537 million tons. 

Provincial Food Departments began their wheat procurement almost one and a half month late.  The Economic Coordination Committee (ECC) of the cabinet in its meetings held on 08 April, 2019 and 15 May, 2019 approved the procurement targets for PASSCO and Provincial Food Departments, respective at 6.250 million tons.  The actual wheat procurement was made at the tune of 4.032 million tons by the public sector which shows a decline of 35 percent against the procurement target. 

ECC of the Cabinet on 20 November, 2018 allowed export of 0.5 million tons of wheat from the public sector, at that time, public sector stocks were reported at the level of around 10 million tons. On the requests of provincial Food Departments for allowing export of 3 million tons of wheat, the ECC allowed 0.5 million tons.  It was also decided that provincial governments will bear complete costs of the exports.  PASSCO successfully exported the allocated quantity of 0.1 million tons through open tendering process at the rate of PKR 32759 per ton against the reserved price of 32,500 per ton.  However, Provincial Food Departments could not export wheat.

Similarly ECC of the Cabinet on 29-01-2019 allowed export further quantity of 0.5 million tons of surplus wheat/wheat products on PASSCO’s earlier bidding held on 11 January, 2019.  At this time wheat stock with the public sector was 7.5 million tons.  Against the allocated quantity of 0.5 million tons, PASSCO could only export a quantity of 0.063 million tons, because of price differential in the international market. 

ECC of the Cabinet imposed an immediate ban on the export of wheat and wheat flour 17-07-2019. Later on the ECC of the Cabinet imposed an immediate ban on fine flour on 25 October, 2019 and for suji and Maida on 01 November, 2019.  On the request of the Provincial Governments to curb rising prices ECC of the Cabinet allowed procurement of 1.10 million tons from PASSCO to Provincial Governments. 

The Committee took serious notice of the situation and directed the Ministry and the Provincial Food Departments provide details of monthly consumption in the provinces.  Complete stock position was requisitioned as well.  Provincial Food Departments stressed incessantly that there had been no wheat shortage in the provinces. The Committee demanded the reason for procuring more wheat from the Federal Government. 

Chairman Committee, Senator Muzafar Hussain Shah, directed the Sindh Food Department for stock details of in the Public Sector in Sindh in May 2019 and month wise information since November 2019. He asserted that concrete ways to avoid such a situation in future must be formulated and submitted to the Committee on the 06 February, 2020. 

While deliberating over the situation in Punjab, Chairman Committee, Senator Muzafar Hussain Shah questioned the Punjab Food Department wether it had a mechanism to ensure the measure of wheat being procured in the Private Sector.  He directed the Department to submit monthly consumption details in Punjab and stock position in June and July, 2019 in the next meeting.  The Committee directed the Ministry to provide details of hoarding and smuggling in the next meeting as well. 

Chaired by Senator Muzafar Hussain Shah, the meeting was attended by Senator Najma Hameed, Senator Sajjad Husssain Turi, Senator Seemee Ezdi, Senator Prof. Sajid Mir, Senator Imamuddin Shouqeen and senior officers from the Ministry for National Food Security and Research, PASSCO, Provincial Food Departments of all four provinces along with all concerned.