That Pakistan estimates its livestock GVA on a 15-years old outdated census has been highlighted in this space many times. Contribution of Pakistan’s livestock segment to national GDP is roughly equivalent to that of all Large-Scale Manufacturing put together. Average annual growth of 3.25 percent during past 15 years in the livestock segment has provided surer footing to economic growth, even if only on paper! (For more, read “Count the cattle, not just the sheep”, published on 17 June 2021).
Surprisingly, it’s not just the estimate of GVA from cattle and sheep that’s suspect. Poultry segment’s estimates are also based on similar assumptions, which has mostly escaped scrutiny due to quantum productivity jump in the industry, observed through declining prices (in real terms) since the last census. But the pandemic laid bare the shaky foundations of poultry estimates as well, where ‘steady growth’ assumptions allowed econometricians at National Accounts to present a rosier picture of economic rebound than may have been the case, lifting performance of agricultural sector in general. (For more, read “Measuring poultry GDP”, published on 25 November 2021).
Now, a look at agricultural feed input data published by Ministry of National Food Security & Research shows how little Pakistan truly knows about the performance of its livestock segment, and whether it is possibly facing a crisis. Although no hard periodic statistics are available of crops used as feed inputs, BR Research has made an attempt to re-engineer the figures by using base year National Accounts for 2005-06, and using constant factor prices to re-produce year-wise output.
According to Ministry of National Food Security & Research, Pakistan’s major animal feed inputs include green fodder, wheat fodder, cotton sticks, dry stalks and piths of maize, rice crop straw, sugarcane fodder. Other minor crops such as barley, sorghum, millet, gram, sesamum, and mustard also contribute to livestock fodder, but their total share in fodder value during base year 2005-06 was estimated at less than 3 percent.
Periodic statistics from MNFS&R indicate that overall volumetric output of major crops has shockingly shown little to no growth in the past 15 years (since base period 2005-06). If BR Research estimates of 6 major fodder contributors are anything to go by, Pakistan produced 128 million tons of fodder in FY06; by FY19, that number had barely inched up to 131 million tons, with 15-year average of less than 130 million tons.
Within the major crop mix, output of green fodder and cotton sticks has recorded a secular declining trend, albeit at different scales. It appears that these have increasingly been replaced by greater feed input using pith and stalks of maize crop. But even these turn out to be mere assumptions. It so happens that MNFS&R applies constant percentages to estimates of annual grain outputs to eke out the quantum of fodder left behind at the time of harvest.
But what’s most revealing is the value-add calculated based on the assumptions galore. Hard data from MNFS&R shows that growth in fodder inputs value has come to a standstill over the past 15 years, rising at just 0.90 percent CAGR between FY06 and FY19 (using constant factor prices). That finding complements BR Research own estimates of stagnant fodder volume growth.
But here is the kicker: if livestock inputs (fodder and other intermediary consumption) are barely rising, what explains the over 3 percent annual rise in Livestock GVA, with Pakistan’s cattle/buffalo population growing from 54 million to 94 million to date (at a CAGR of 3.4 percent)? Or how on earth, have Pakistan’s dairy farmers maintained a constant milk yield of ~5 litres when quantum of fodder (per capita) available to them is declining? And how can the country still be the third largest dairy producer on the planet, producing over 64 million tons of milk every year according to Finance Ministry’s flagship annual publication Economic Survey.
While dairy and red meat prices may not make it to the headlines during primetime news, it may be useful to remember that fresh milk, mutton, and beef prices have outpaced national CPI in 13 out of last 15 years. Pakistan is facing a silent crisis of disinformation in its livestock sector, and it will remain unnoticed until the country has reliable estimates of what the segment looks like in present day.
Instead, according to news the country is going into another fresh GDP re-basing exercise that will rebase GDP to 2015-16 prices in next quarter, without re-adjusting the assumptions underlying the outdated Livestock Census of 2006. Pity the fool?