Pakistan’s wheat production to fall by 11%

Pakistan’s wheat production is expected to decline by 11% to 27.9 million metric tons this year due to dry weather conditions, the Ministry of Finance stated in its monthly economic outlook.

Last year, Pakistan had a record wheat harvest of 31.4 million metric tons, but this year’s output is expected to be 3.5 million metric tons lower, raising concerns about domestic supply shortages.

The report highlighted that favorable weather had been key to achieving previous production targets, but prolonged dry conditions could create water stress for Rabi crops, particularly wheat in rain-fed areas, as noted by the Pakistan Meteorological Department.

With production falling short of demand, Pakistan may have to import wheat to bridge the gap. In October 2024, the Ministry of Food had cautioned the government that the continued delay in setting wheat support prices and making procurement arrangements could discourage farmers from planting enough crop. The ministry warned that this could lead to wheat imports exceeding $1 billion.

Despite these warnings, federal and provincial governments did not announce a wheat support price, opting instead to implement an International Monetary Fund (IMF) condition a year ahead of schedule.

The Ministry of National Food Security had recommended that the prime minister set a profitable support price and procurement target for the 2024-25 Rabi sowing season, while committing to full deregulation from 2025-26, as required under the IMF program. However, the government did not accept the proposal.

In 2023, the federal government had fixed the wheat support price at Rs3,900 per 40 kg, providing an 18% profit margin to farmers based on an estimated cost of Rs3,304 per 40 kg.

The food ministry had emphasized the need for a clear policy on wheat pricing and procurement, urging the federal government to coordinate with provinces to ensure market stability. However, with no formal policy in place and deregulation imminent, Pakistan faces uncertainty in wheat supply and pricing in the coming months.

Tags: Pakistan, wheat, crop forecast