Strategic wheat reserves: Govt to cut stocks by 2 million tons
Government approves Rs165 billion sovereign guarantees for procuring 6.6 million tons from farmers.
ISLAMABAD:
The government on Wednesday decided to lower the limit of maintaining strategic wheat reserves by two million tons and approved Rs165 billion sovereign guarantees for procuring 6.6 million tons from farmers.
The decision on reducing the strategic wheat reserves from three million tons to one million tons will partly resolve the issue of shortage of silos and also help in timely repayment of State Bank of Pakistan loans, obtained for procuring the commodity.
According to the decision, taken at a meeting of the Economic Coordination Committee (ECC), headed by Finance Minister Dr Abdul Hafeez Shaikh, the federal government will extend sovereign guarantees to the provinces and Pakistan Agriculture Storage and Supplies Corporation (Passco) for procurement of wheat.
ECC asked Punjab and Passco to maintain reserves of 500,000 tons each, taking the total reserves to one million tons. ECC also allowed the provinces to increase wheat storage beyond one million tons, provided they procure more than the targets set by the committee.
It asked the Punjab government to procure 3.5 million tons, Passco 1.3 million tons, Sindh 1.3 million tons, Khyber-Pakhtunkhwa 0.4 million tons and Balochistan 70,000 tons of wheat from farmers, at the minimum guaranteed price of Rs950 per 40 kilogramme, taking the total quantity to 6.6 million tons.
Punjab already has 2.7 million tons of wheat, which are to be sold in order to create space for fresh stock at public storage facilities.
A committee, constituted to resolve the issue of strategic wheat reserves and give provinces authority to export wheat according to their requirements, advised ECC that wheat export should continue without imposition of any restrictions. A cut-off date should also be announced so wheat exporters could meet their export targets.
ECC was informed that the country has sufficient stocks of sugar to meet the requirement till October, including for Ramazan. Additionally, the private sector has opened letters of credit for import of 87,000 tons of sugar.
A Trading Corporation of Pakistan (TCP) representative also informed the ECC that 100,000 tons of urea fertiliser have already been imported and a further 130,000 tons will arrive on March 19 to meet crop requirements. The government has opened a $100 million letter of credit for the import.
Published in The Express Tribune, March 17th, 2011.
The government on Wednesday decided to lower the limit of maintaining strategic wheat reserves by two million tons and approved Rs165 billion sovereign guarantees for procuring 6.6 million tons from farmers.
The decision on reducing the strategic wheat reserves from three million tons to one million tons will partly resolve the issue of shortage of silos and also help in timely repayment of State Bank of Pakistan loans, obtained for procuring the commodity.
According to the decision, taken at a meeting of the Economic Coordination Committee (ECC), headed by Finance Minister Dr Abdul Hafeez Shaikh, the federal government will extend sovereign guarantees to the provinces and Pakistan Agriculture Storage and Supplies Corporation (Passco) for procurement of wheat.
ECC asked Punjab and Passco to maintain reserves of 500,000 tons each, taking the total reserves to one million tons. ECC also allowed the provinces to increase wheat storage beyond one million tons, provided they procure more than the targets set by the committee.
It asked the Punjab government to procure 3.5 million tons, Passco 1.3 million tons, Sindh 1.3 million tons, Khyber-Pakhtunkhwa 0.4 million tons and Balochistan 70,000 tons of wheat from farmers, at the minimum guaranteed price of Rs950 per 40 kilogramme, taking the total quantity to 6.6 million tons.
Punjab already has 2.7 million tons of wheat, which are to be sold in order to create space for fresh stock at public storage facilities.
A committee, constituted to resolve the issue of strategic wheat reserves and give provinces authority to export wheat according to their requirements, advised ECC that wheat export should continue without imposition of any restrictions. A cut-off date should also be announced so wheat exporters could meet their export targets.
ECC was informed that the country has sufficient stocks of sugar to meet the requirement till October, including for Ramazan. Additionally, the private sector has opened letters of credit for import of 87,000 tons of sugar.
A Trading Corporation of Pakistan (TCP) representative also informed the ECC that 100,000 tons of urea fertiliser have already been imported and a further 130,000 tons will arrive on March 19 to meet crop requirements. The government has opened a $100 million letter of credit for the import.
Published in The Express Tribune, March 17th, 2011.