Soaring prices of essential items made urban people more vulnerable

Pakistan is self-sufficient in food stocks with supplies of kitchen items assured either through domestic production, yet soaring prices are making foodstuffs unaffordable for millions of urban people, especially labour and salaried classes.
It is the rising un-affordability of basic food items that have led many to challenge President Asif Ali Zardari's claim on Tuesday in a speech delivered at the fourth death anniversary of Benazir Bhutto that even though the world is facing a recession, in Pakistan we have food even after facing disasters including the floods.
Pakistan is, however, not self sufficient in edible oils which are imported accounting for a whopping 123 billion rupees equivalent of scarce foreign exchange in July-March 2010-11. According to information collected from multiple sources including the federal government, economists, traders, farmers and other related federal departments and ministries, the government has identified wheat, sugar, rice, milk, meat, edible oil, urea, pulses and vegetables as key items on which food security depends.
Price analysis of the important food items show that soaring prices of essential kitchen items have made millions of people more vulnerable across the country especially in the cities, while increasing commodity prices including rice, pulses, sugarcane, vegetables and oilseeds in rural areas have brought prosperity to rural areas, especially big agriculture land owners.
The prices of important crops like wheat, cotton, sugarcane, paddy, and pulses have seen a significant increase during the past four years which are as fallow: Wheat Rs 950 per kg at farm, paddy Irri-6 Rs 800 per 40 kg at farm, paddy Basmati Rs 1250-1500 per 40 kg at farm, prices of different pulses like Masoor, Mash, Moong, gram are ranging Rs 2400 to Rs 6000 per 40 kg. Similarly the price of cotton per bale reached Rs 13,500 in the market. According to experts the increasing prices of agriculture commodities have increased the income of farmers' manifold leading many to argue that it is high time the sector is brought into the income tax net.
The government for 2011-12 crop season has increased the wheat support price from Rs 950 per 40 kg to Rs 1050 per kg, which would further raise the cost to the consumer. At present the prices of the most important kitchen items including rice, wheat flour, pulses like gram. Mash, Mong, Masoor, Lobia, cooking oil/ghee, vegetables like onions, potatoes, tomatoes, spices, tea are as fallow: Normal rice Rs 55 per kg, normal wheat flour Rs 32 per kg, gram pulse Rs 90 per kg, Moong Rs 150 per kg, Masoor Rs 125 per kg, Mash Rs 150-170 per kg, cooking oil/ghee Rs 190 per kg, onions Rs 40 per kg, tea Rs 500 per kg, sugar Rs 55 per kg and tomatoes Rs 40-50 per kg.
Milk Rs 70 per kg, yogurt Rs 80 per kg, cow/buffalo meat Rs 280 per kg, goat meat Rs 500 per kg and chicken meat Rs 225 per kg, clearly indicates that in terms of food stocks Pakistan has no food security issues, but in terms of affordability over 40 per cent of the Pakistani masses are facing severe challenge, said an economist.
Dr Suleman Shah, former advisor to the Finance Minister and Finance Minister during the caretakers stated that the income disparity in the rural areas as well as in urban areas has widened as a result of rising crop prices. "Only 40 percent of the rural population is engaged in the crop sector and a vast majority of them are small landholders. This means only a small portion of population in the rural areas has gained from the increasing crop prices," he elaborated.
In Punjab, for example, less than half of the rural population is engaged in the crop sector. Some 90 percent of it fall in the category of small farmers with landholdings up to 12.5 acres. Quoting world Food Programmes recent repot DR Shah said that food consumption in the country has declined as anyone who could afford two chapattis in 2007 can only afford one today.
"Farmers last year sold wheat for Rs 850-960 per 40 kg or around Rs 21-24 per kg, while a consumer pays Rs 32-35 for normal quality wheat flour per kg. Finer quality fetches as high as Rs 40. At a fair price shop it sells for Rs 32 per kg. Thus a family of 6 would need around 2kg wheat flour for three meals a day and would have to spend a minimum of Rs 65 on wheat flour per day, nearly Rs 100 for vegetables and pulses etc, so it would be extremely difficult for a labourer or someone earning minimum wage to survive under the prevailing prices", Shah added.
Mohammed Ibrahim Mughal, Chairman AgriForum Pakistan contended that smaller farmers could not benefit from the soaring commodity prices not only because they did not have a marketable surplus but also because they had to pay a lot more for inputs like fertilisers, pesticides, diesel, and so on. An overwhelming majority of small farmers buy inputs on credit and, thus, are forced to pay a much higher price than those who pay cash for these inputs," claims Mughal. "Even if they have cash their cost has gone up manifold, offsetting the gains of higher crop prices."
"Our productivity per acre has decreased significantly over the decades whereas India has successfully managed to substantially boost per acre yield. The new wave of economic prosperity in the rural areas should not be allowed to take our focus off the need to boost productivity. That will be disastrous for the economy as well as people," he warns.
According to a former Agriculture Development Commissioner Dr Qadir Bux Baloch Pakistan's total grain production is 36 million tons and overall grain consumption is around 28 million tons per annum. He said that figures show that Pakistan has sufficient wheat stock, but the government is lacking storage capacity, which is about 4.5 million tons, and is mostly utilised for wheat storage.
Pakistan in 2010-11 crop season produced nearly 25 million tons of wheat, nearly 6 million tons of rice (including Irri-6 and Basmati), over 55 million tons of sugarcane, recorded 12 million bales of cotton and sufficient farm products, while Pakistan's annual wheat consumption is 21.7 million tons. According to experts lack of storage capacity is one of the real threats for food security which damages thousands of tons of grain including rice, pulses and wheat every year. When sustenance kitchen budget of a family climbs over Rs 5000 (minimum wage is Rs 7000 or $83 under the law) there is no way a family can make both ends meet. If street crimes have risen, it is not surprising", said an expert.