ISLAMABAD - Azad Jammu and Kashmir, Gilgit Baltistan and Army have claimed quality, taste, and texture issues with imported wheat and requested the Federal Government for the provision of 100 per cent domestic wheat during the ongoing food year 2024-25.
The seven agencies/regions have lifted only 19 percent of their demanded wheat till October 2024, official source told The Nation here Thursday.
To keep strategic reserves for emergency use and supply to seven wheat deficient agencies/regions based on their annual demand Pakistan Agricultural Storage and Services Corporation (PASSCO) procures wheat from Punjab, Sindh and Balochistan.
According source, Ministry of National Food Security and Research (NFSFR) received wheat demand of 1.398 MMT from the seven agencies/regions including Khyber Pakhtunkhwa, Azad Jammu and Kashmir, Gilgit Baltistan, Pakistan Army, Air Force, Navy and Utility Stores Corporation for the food year 2024-25. However, they have lifted only 0.266 MMT till end September 2024, leaving behind eight substantial stock of 1.132 MMT.
At the start of the food year 2024-25, i.e. April 01, 2024, PASSCO’s carry forward wheat stock was 1.266 MMT including imported wheat stock of 0 678 MMT procured in 2021 and 2022 and domestic wheat stock of 0.588 MMT procured in 2022 and 2023.
ln 2024, new stock of domestic wheat of 1785 MMT was procured in order to dispose of the old imported wheat stock of 0.678 MT in food year 2024-25 (reduced to 0.555 MMT on October 01, 2024), PASSCO has proposed that the release ratio for agencies/regions should be 50% domestic and 50% imported in order to reduce higher risk of deterioration of quality of imported wheat due to pest infestation and other issues.
On 24 July 2023, the ECC of the Cabinet approved supply ratio of domestic and imported wheat at 50/50 for all agencies except GB where it was fired at 75/25. On February 01, 2024, ECC of the Cabinet approved 100% domestic wheat allocation for GB for the remaining financial year against its approved quota of 150,000 MT. GB is of the view that this decision is valid until a permanent solution is agreed and not restricted to the financial year. PASSCO disputes this interpretation which has created a situation where GB i.e lifting domestic 75% of the allocated wheat quote and not the imported 25% GB has raised concerns about potential shortage of wheat in the winter months.
The source said that AJ&K, GB and Pakistan Army have requested 100% domestic wheat claiming quality, taste, and texture issues with imported wheat.
According to the Ministry of National Food Security, it is important to dispose of the old imported wheat stock because it was procured in 2021 and 2022 and its holding cost is higher than the domestic wheat due to higher initial procurement price and compounding of interest rate. The cost of the remaining stock of imported wheat on October 10, 2024 is Rs.87.2 billion but its estimated current market value is Rs.41.10 billion (at the prevailing market price of Rs 75,000/MT), the source said. The potential loss can be avoided if agencies/regions lift their demanded and allocated stock based on 50/50 ratio during the Food Year 2024-25, it added.
In compliance with the PM’s directive, dated 11° September, 2024, PASSCO’’s winding-up is being contemplated and remaining wheat stock, particularity old imported wheat, needs to be lifted by the seven agencies/regions, before the arrival of the wheat crop next year, to avoid potential losses for PASSCO resulting from financial and quality issues.