No wheat support price from next season

Wheat prices to follow international rates; private companies to manage procurement

ISLAMABAD:

The federal government has decided to withdraw from the wheat procurement process to meet another condition set by the International Monetary Fund (IMF).

The IMF has barred the federal government from setting a support price and from the next season, wheat prices will be determined in line with international market rates.

The wheat support price is the minimum guaranteed price set by the government at which it commits to purchase wheat from farmers during the procurement season.

Its purpose is to protect farmers from price fluctuations; ensure stable income for wheat growers; encourage sufficient wheat production and maintain food security by building government reserves

If market prices fall below this rate, the government buys wheat at the support price; if market prices are higher, farmers are free to sell in the open market.

According to official sources, from next season the Ministry of National Food Security will fix prices of the commodity based on global benchmarks.

They said the federal and provincial governments will only maintain emergency wheat stocks. Collectively, the federation and provinces will store 6.2 million metric tons of wheat annually.

Sources said the procurement of strategic reserves will also be carried out by private companies instead of the federal government.

Under the new arrangement, the Centre will maintain 1.5 million metric tons, Punjab 2.5 million, Sindh 1 million, K-P 0.75 million, and Balochistan 0.5 million metric tons of wheat.

Private companies will procure wheat on behalf of the federation and provinces. According to the Ministry of Industries and Production, private companies will also be responsible for financing and storage, while the government will only pay service charges.

The government estimates annual savings of Rs570 billion. Sources said the Ministry of National Food Security has allocated Rs30 billion for service charges.

The federal government on October 20 approved the wheat policy 2025–26, setting the wheat procurement price at Rs3,500 per 40kg to ensure fair returns for farmers, safeguard national food security, and maintain strategic reserves.

The decision was made during a high-level meeting chaired by Prime Minister Shehbaz Sharif and attended by key stakeholders, including the chief ministers of all provinces.

Presently, the federal government provides bank guarantees for wheat procurement through the Pakistan Agricultural Storage and Services Corporation (Passco). Due to delayed payments to Passco, circular debt in the food sector has reached Rs270 billion.