Wheat exports halve to $3m as falling prices bite

KARACHI (Neo Web Desk): Pakistan’s wheat exports halved to 10,441 tonnes (fetching $3 million) in 2014-15 from 20,037 tonnes ($7m) in the preceding fiscal year, the Pakistan Bureau of Statistics said on Wednesday.Lower world wheat prices from December 2014 onwards is the major reason behind slow exports. However, a trader said some countries might have offered a better price for high quality wheat of Pakistan, given the low prices at present.The price of wheat on the world market fell from $269 per tonne in December 2014 to $209 in June 2015. This has now further dropped to $200 per tonne, according to flour millers.Compared to this, Pakistan fetched a price of $287 a tonne in FY15. The average per tonne in FY14, however, was $349.Wheat exports in June were 192 tonnes ($49,000) compared to 156 tonnes in May ($39,000), which means average per tonne price of $255 and $250, respectively.Pakistan kept striving to earn foreign exchange from last year’s and new season’s wheat stocks, but depressed price on the world market proved to be one of the main obstacles.The federal and provincial governments failed to introduce local grain in various world food fairs and festivals. Earlier this month, the federal government extended the deadline for export of subsidised wheat for Sindh and Punjab till July 31, 2015, but it did not work.The government allowed export of 1.2m tonnes of wheat in January 2015 with a subsidy of $90 per tonne to compete in world markets.A flour miller said the Sindh government has around 1.6m tonnes wheat stocks (700,000 tonnes of last year and 900,000 tonnes from 2014-15 crop), while Punjab holds around 5m to 5.2m tonnes (3.5m tonnes of 2014-15 crop and 1.7m tonnes of last year’s crop).“The exports aren’t possible when the local wheat is available at over $300 a tonne while the price of imported one is $200 a tonne,” the miller said.The government has increased import duty on wheat to 40 from 25 per cent. Besides, 5pc income tax is also charged. “Even if the duty impact and income tax are calculated, the imported wheat will either cost lower or the same as local wheat,” the miller said, adding that local prices are Rs3,250 per 100kg bag.Pakistan Flour Millers Association’s (PFMA) Sindh Chairman Mian Mahmood Hassan said the provincial government had the facility to store around 400,000 tonnes while 1.2m tonnes are lying in the open and exposed to rains and floods.The association, he said, had suggested the Sindh government to store some quantities in the flour mills and their godowns in Sindh, including Karachi. Besides, it had also asked the provincial government to provide wheat at 3,200 per 100kg bag at the mills to clear at least carryover stocks of last year and this year’s stocks.According to Economic Survey 2014-15, wheat production stood at 25.478m tonnes during FY15, down by 1.9pc over the preceding year’s production of 25.979m tonnes because of prolonged winter season and unprecedented rains during April and May that caused damages to grain at harvesting time.Pakistan also imported 686,852 tonnes of wheat costing $185m — $269 a tonne — in 2014-15 compared to 377,441 tonnes worth $107m ($284 a tonne) in 2013-14.

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