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Procurement of wheat: Govt urged to set up farmers’ markets to reduce middlemen’s role – Pakistan

LAHORE: To reduce the role of the middlemen in procurement of wheat and help growers to earn a suitable return on their crops, the government should allow farmers to set up farmers’ markets where anyone can come and buy wheat directly.

Besides, each village will be allowed to set up mini flour mills which may help create employment and opportunities to earn more through value addition. In the past villages have traditional ‘Chakkis’ which produce whole wheat flour but mini flour mills can help producing many value added items.

This was proposed by Agriculture Republic, a think tank on agriculture, Co-Founder Aamer Hayat Bhandara while talking to Business Recorder here on Saturday while discussing the issues faced by the farming community in getting suitable return on their produce and ways and means to minimize the role of middlemen in wheat trade.

Aamer was of the view that the government should also support farmers in setting up farm-level or village-level grain storage units to ensure that they can set enough crops aside to meet their needs besides allowing them to sell their wheat directly to buyers including big-box markets aimed at reducing the role of the middlemen.

He claimed that a small farmer cannot sell his wheat at a price above his costs. Instead of a decent profit margin, his crops just fetch him enough to make his ends meet. If he asks for higher price for his wheat, he is accused of crimes against humanity. Apparently, he is responsible for the unaffordable price of wheat, which the poor cannot buy.

This year, Sindh has set the support price to be PKR 2,000 per maund, while Punjab Government announced the support price to be PKR 1,800 after a lot of agitation. But the official notification has not been released. It has created fears for Sindh which is expecting smuggling of cheap wheat from Punjab to Sindh, he added. Aamer alleged that smuggling will not be done by the farmers but the middlemen as they are ones, who buy cheap wheat and sell it at high prices to the final consumers.

As far as smuggling is concerned, the small farmers of Sindh will be forced to sell their wheat at PKR 1,500-1,700 per maund barely breaking even. If they do not do it, then they are at risk of losing it all. There is no storage space to secure all the wheat produce. This may also lead to shortages down the road, and the Government will be forced to import wheat at PKR 2,200-2,500 a maund, he claimed.

We as a nation need to decide, if we are an Agricultural country or not. With half the population of the country lives in rural areas; so unless the Government can create employment opportunities in services or manufacturing sectors for rural youth, agriculture is going to remain a mainstay of the country. The Government needs to decide on what support, it is going to provide and to whom. Is it going to be subsidies to the farmers in the shape of cheap diesel, fertilizers, pesticides, etc., or is it subsidized flour sold in Utility Stores? Can the Government afford to provide subsidies to all the poor farmers, who cannot make any money due to the very high costs of inputs?’ he questioned.

Aamer Hayat Bhandara asked the government to help the farmers become more productive, so that they can invest in mechanization and better inputs. The higher yields will allow farmers to sell more, but at lower margins as economies of scale will start playing a part. If the Government can help the farmers, the farmers can grow enough to bring prices of commodities down, so the 40% of population living below the poverty line can afford to eat enough.

Copyright Business Recorder, 2021

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