Government urged to evolve strong, sustained wheat export policy

The Wheat Traders Association of Pakistan (WTAP) commends the government for facilitating export of wheat, which is progressing. The association through a press release points out certain critical factors to the Ministry of Food and Agriculture and the Ministry of Commerce to keep in mind for encouraging this trade for the benefit of all stakeholders.
I says that without doubt, the current export has been a tremendous boom for Pakistan, as exports are being made by the private sector without any subsidy. Furthermore due to these exports the godowns of the govt in Punjab and Sindh, having huge inventory reserves, need space for the upcoming crops and also interest being accrued on the large loans due to the State Bank. The farmers will also get their minimum support price in the upcoming crop if inventories are reduced. This was stated by Saleem Ahmed Nooruddin, Secretary, Wheat Traders Association of Pakistan in a press statement.
During last exports of wheat from Pakistan, the trade of wheat was curtailed due to valid reasons but the effect on the international buyers and domestic wheat traders and exporters was profound.
Several countries are following the policy of free trade of wheat ie while keeping the export markets for wheat alive. They allow import of wheat by the private sector if and when required. This preserves Pakistani markets, and stimulates the Pakistan economy and promotes efficient trade and resulting good governance in this trade, Saleem said.
Secondly and critically, he pointed out, the govt. would like to reduce its role in procuring of wheat at the time of new crop coming into the markets by March 2011, whereby economic advantages accrue that the funds are not blocked and they promote the free trade of wheat. The govt needs quality space to store the March 2011 onwards buying for minimum strategic reserves.
While getting economic strategic results the govt may slow the procurement of wheat at the support price from farmers and encourage with several incentives the private sector to procure wheat for domestic consumption and grinding by the mills or the export at or above the support price. The govt can monitor the balance carefully. This has obvious benefits for all and will stimulate the economy and give boon to economic activities and free trade in the country. Farmers, exporters and all stakeholders will benefit.
The private sector will then be encouraged to build quality supplies and latest techniques of storages, which the govt is forced to spend unnecessary funds. The private sector must feel this is a sustained policy. Increasing the role of the private sector as a major factor in the import and trade of wheat will bring several lasting benefits to the Pakistan economy and profound advantage to the govt and all stakeholders. Desperate needed economic activity will result, the Secretary added.
The active involvement of private sector in the wheat procurement season will bring several benefits to both govt and private sector while the objective of the govt in procuring wheat and holding the support price will be served. The WTAP wishes to point out that Pakistan's wheat is of very good quality and can procure premium in the international markets.
However, during procurement, handling, bagging and storing, the quality and specification of wheat deterioratesto the extent that less than desired quality of wheat is exported due to infrastructure problems. Obviously, there are storage issues. Good governance is needed at middle and lower management levels.
The prices in the international market coupled with the bumper crop in Pakistan again coupled with the upcoming wheat procurement season along with excellent support prices to farmers presents the govt of Pakistan with an unbelievable opportunity at this stage. To lose this opportunity will be a tragedy for the nation.
Exports should be continued, and at all costs, even to the extent if wheat needs to be imported, God forbid, in the future. Policy has to be sustained. The trade and Pakistani wheat in international markets must be promoted. Increase in export, in FE Funds, Central Bank Loan reduction, Private sector involvement and overall prosperity to the economy can occur if steps are taken to seize this opportunity with a sustained policy.
During continued exports, the exporters will seek diversified markets, ensure high quality standards to get a better price, and work hard for profit benefits and to make a place during these volatile times for Pakistani wheat in the international markets. There must be a sustained export initiative. The initial export target can be 3 millions tons.
On behalf of WTAP, he Secretary has appealed to the govt to clearly ensure a strong and specific sustained wheat export policy for the benefit of the government and people by taking advantage of the current favourable circumstances. These circumstances can be translated to the benefit of all stakeholders. Furthermore, focusing on quality will pay rich dividends.-PR