Paddy, sugarcane, cotton growers: KBP urges government to announce new support prices

Kisan Board Pakistan (KBP) has urged the government to immediately announce new support price for paddy, sugarcane and cotton growers with upward revision in line with increase in the input prices, withdrawal of agricultural income tax and exempting agricultural inputs from the sales tax.

These demands were raised by the KBP leaders in protest demonstrations arranged by its members throughout the country on the call of KBP Central President Sardar Zafar Ahmad Khan to observe November 17, as protest day. KBP leaders also urged the government to declare flood affected areas as calamity hit. According to the information reached here, KBP members staged sit-in and protests at all the district headquarters in all the four provinces to condemn the anti-farmer policies of the government.

They were carrying banners and placards inscribed with their demands such as withdrawal of agricultural income tax, revising upward cotton, sugarcane and paddy prices and exempting agricultural inputs from GST. KBP Lahore President Mian Rasheed Minhala, Vice President Chaudhry Bashir Warraich, General Secretary Sardar Irfan Ullah Padhana and others said that flood had badly damaged the growers and they do not even have sufficient funds to buy inputs for wheat crop. They said area of 260,000 acres under paddy sowing was damaged during the last flood. They said that now paddy was being sold at the lower rates of Rs 1400 per maund while input cost is around Rs 1500 per maund. They urged the government to fix paddy prices at Rs 3000 per maund to eliminate the unrest found among the growers.

Meanwhile growers from Kasur, Sheikhupura and Gujranwala staged protests and submit their charter of demand to DCOs concerned. Similarly a big rally was taken out in Hafizabad, Sialkot, Khushab, Mianwali, Bhakkar and other areas of Punjab and other provinces. According to Secretary Information KBP Haji Muhammad Ramzan growers also held a press conference in Sahiwal and they demanded withdrawal of agricultural income tax and GST on agri inputs. KBP Central President Sardar Zafar Ahmad Khan has urged the government to consult all representative organisations of growers to resolve problems of the farmers.

Copyright Business Recorder, 2014

SCA asks government to implement fixed rate of sugarcane

Sindh Chamber of Agriculture (SCA) has demanded of the government to implement the sugarcane's fixed rate of Rs 182 per 40 kilogram. The chamber has also decided to become party to the petition filed in Sindh High Court by the Sugar Mills Association. The members, in a meeting held here, expressed concern that if the sugar mills in Sindh did not start crushing, standing crops on thousands of acres would be affected and the next cultivation might not be in time.

The meeting was told that the rate of Rs 182 per 40kg of sugarcane had been fixed by the Sindh Minister for Agriculture in consensus with the sugar mill owners but now the owners were trying to block implementation of the rate to maintain their monopoly.

Opposing the application filed by the sugar mills association in Sindh High Court, the chamber decided to become party to the petition. The meeting decided that the representatives of SCA would remain present in the court on November 19. The meeting was chaired by SCA President Syed Nadeem Qamar.

Copyright Business Recorder, 2014

Sugarcane crushing: delay may cause adverse impact on wheat sowing

The sugar industry has not yet started crushing in violation of the Sugar Factories Control Act 1950, which may lead to reduced sowing of wheat crop. According to an official source of the Ministry of Food Security and Research, under the law, sugar mills in Sindh are bound to start crushing on October 1 and those in Punjab by November 1, but so far the sugar industry in both the provinces has not started crushing.

The delay in crushing of sugarcane will delay the sowing of wheat crop from November to December - a suboptimal time for sowing of the country''s staple grain, he said. Not only will the delay in sugarcane crushing lead to reduction in wheat output, it will also discourage sugarcane growers. Sugarcane growers may opt for other Kharif crops like rice and cotton and it may also affect sugarcane production in the years to come, he said.

According to provincial government reports, sugarcane production for 2014-15 is estimated at 63.4 million tons from an area of 1,114,135 hectares as compared to 66.8 million tons the previous year from an area of 1,162,001 hectare, showing a decrease of 3.5 million tons. Punjab province, which accounts for 62 percent of the country''s sugarcane production, may witness a decrease as in 2014-15 sugarcane has been cultivated in Punjab on an area of 756,750 hectares as compared to 696,079 hectares. Sugarcane production for 2014-15 in Punjab is estimated at 39.67 million tons as compared to 43.7million tons the previous year, showing a decrease of 4 million tons.

In Sindh, sugarcane has been cultivated on an area of 310,368 hectares during 2014-15 as compared to 297,558 hectares the previous year. Sugarcane production in Sindh is estimated at 18.93 million tons for 2014-15 as compared to 18.36 million tons in previous year. During 2014-15, sugarcane has been cultivated in Khyber Pakhtunkhwa (KP) on an area of 107,693 hectares as compared to 107,693 hectares the previous year. Sugarcane production for 2014-2015 is estimated at 4.85 million tons as compared to 4.8 million tons the previous year.

The official further revealed that the provincial governments set procurement price of sugarcane in consultation with representatives of both the sugar industry and farmers'' organisations, based on the recommendations of Agricultural Policy Institute (API) and their departments of agriculture, food, and industry. They fix procurement price of sugarcane on the basis of sugar recovery from cane and in Sindh sugar recovery of sugarcane is higher than in Punjab. He said the provincial governments of Punjab and Khyber Pakhtunkhwa (KPK) have announced procurement price of sugarcane at Rs 180 per 40 kg for 2014-15, whereas Sindh announced a price of Rs 182 per 40 kg sugarcane crop.

Copyright Business Recorder, 2014

Delay in fixing prices: sugarcane growers stage protest demonstration

Expressing voice concern over delaying in fixation sugarcane prices for this year, dozens of growers staged a protest demonstration on main Sher Shah Suri Road near Press Club here on Monday, demanding the government to fix prices as per growing ratio of price-hike in the country.

The protest demonstration was spearheaded by Kisan Council District Peshawar, Arbab Mohammad Jamil, along with dozens of sugar cane growers. The protesting farmers were carrying placards and banner, inscribed slogans in favour of their demands, and against the Khyber-Pakhtunkhwa government. The protesters marched from Peshawar Press Club to Jinnah Park on main Trunk Road, where they staged a sit-in against the provincial government.

Talking to reporters, Arbab Jamil said the provincial government is using delaying tactics in announcement of sugar cane prices for the next season, which is sheer injustice with the poor farmers. He demanded the prices should be fixed at Rs 300 per/40 kilogram for this current year. The growers' leader said the arrangement should be made to export 'Gur' (raw form of sweet) to foreign countries, especially Middle East and Central Asian States. For this purpose, he urged the authorities to proper guide farmers and facilitation for them to export Gur to other countries.

Kisan Council demanded the government to lift ban on export of poplar wood to neighbouring Afghanistan and to restore the irrigation system through 'civil canal' in Duadzai an area of outskirt of Peshawar, Khyber-Pakhtunkhwa. The growers warned if the government failed to accept their demands forthwith, then they would compel on self-immolation in front of Chief Minister House.

Copyright Business Recorder, 2013

Delay in announcing wheat, sugarcane prices: KBP to hold countrywide protest on November 20

Kisan Board Pakistan (KBP) will stage a countrywide protest demonstration on November 20th against delay in announcement of wheat support price and minimum purchase price of sugarcane despite start of crushing season in the country. KBP Central Chief Sardar Zafar Hussein Khan while addressing a farmers' gathering on Monday said that the government has shown criminal negligence by not announcing minimum purchase price of sugarcane despite start of crushing season by the sugar mills in the country.

Similarly, he said silence over the announcement of wheat support price before the start of wheat sowing season and not providing cheaper electricity to the farmers despite promises were other charges of the present government against agricultural sector. He said that it was resulting in worst exploitation of the growers' community.

He said that the Board would stage a countrywide protest demonstration against delay in announcement, what he said, 'criminal steps of the government'. Meanwhile, the Board office-bearers continued their mass contact campaign to mobilise the growers for making November 20 programme a success. KBP and Sindh body of the Board staged big gatherings in their respective areas and given final touches to protest programme. While addressing these gatherings they claimed that this protest would continue till acceptance of the demands by the growers, Central Secretary Information KBP Haji Muhammad Ramzan said.

Copyright Business Recorder, 2013

Payment to sugar millers: MoF refuses to give Rs 500 million to TDAP

Finance Ministry has reportedly refused to give Rs 500 million to Trade Development Authority of Pakistan (TDAP) to pay sugar millers as inland freight subsidy on export of 0.5 million MT of sugar, reveals official documents available with Business Recorder.

The Economic Co-ordination Committee(ECC) of the Cabinet, in its meeting on September 7, 2013 allowed sugar mills to export 0.5 million MT of sugar out of which 250,000 MT was allowed to be exported with immediate effect up to October 31, 2013 and the remaining quantity of 250,000 MT will be exported from November 1, 2013 onward subject to the following conditions: (i) the sugar mill owners will clear the outstanding arrears of Rs 1.7 billion( as reported by the PSMA representatives) to be paid to the growers; (ii) sugar mills will start crushing in Sindh and Punjab by November 1, and November 15, respectively.

The documents further disclose that the Ministry of Commerce and Textile Industry approached the Finance Ministry for release of approved freight inland subsidy of Rs 500 million on export of 0.5 million MT sugar to the TDAP for compliance of the ECC decision.

However, Finance Division regretted for provision of subsidy stating that the Finance Division is not in a position to provide funds to TDAP. Finance Division further conveyed to Ministry of Commerce and Textile Industry that allocation of funds for inland freight subsidy will be met out of the head of Export Development Fund (EDF).

Commerce Ministry is of the view that EDF does not generate its own funds rather Finance Division allocates and releases the funds to EDF out of the Export Development Surcharge (EDS) collection. The sources said, out of 0.5 million MT of sugar, 27000 MT has been exported so far and the sugar millers are of the view that they will not opt for export without subsidy.

"The entire allocated quantity cannot be exported till December 31, 2013 even if we dispatch it day and night," said Riaz Qadeer Butt, President PSMA Punjab who is protecting the interests of mill owners at all forums including ECC on the permanent absence of Chairman PSMA from the scene. In reply to a question, President PSMA Punjab said that no mill will export sugar when rate in the local market is better as compared to exported commodity.

"Presently, ex-mill rate is about Rs 56 per kg whereas earning from exported sugar is Rs 54 per kg ($460 per ton). In this scenario no sugar mill is ready to export its stocks," he continued. He also disclosed that the government used to pay Rs 2.50 per kg subsidy on export but now SRO is not being issued which implies that subsidy is withdrawn. "If government does not extend subsidy export is not feasible," Butt maintained.

The ECC in its meeting duly represented by the PSMA extended the date for export of 500,000 tons sugar allowed by it till December 31, 2013. However, the ECC made it clear that no further extension would be given on this count. The ECC also allowed delay in sugar crushing date and set new dates for start of crushing season for sugar mills in Sindh as November 20, 2013 and November 25, 2013 in Punjab with the condition that sugar mills would start procurement of the sugar cane from farmers from these dates. The ECC had earlier decided that the crushing season for sugar mills would begin from November 1, 2013 for Sindh and November 15 for Punjab. The extension is being given in view of Ashura, it noted. The ECC was informed that Pakistan Sugar Mills Association has given a categorical assurance that all dues of sugar cane growers have been cleared. This impression, however, contracted in the Sugar Advisory Board (SAB) meeting wherein it was confirmed that sugar mills have yet to pay Rs 170 million to poor cane growers.

Copyright Business Recorder, 2013

Government misled by PSMA, Punjab cane commissioner?

Pakistan Sugar Mills Association (PSMA) and Cane Commissioner Punjab have reportedly misled the federal government regarding sugar stocks in Punjab, giving an impression that current galloping hike in prices is not due to the shortage of commodity, well informed sources told Business Recorder.

On November 12, 2013, Cane Commissioner Punjab and PSMA informed a meeting of Sugar Advisory Board (SAB) presided over by Secretary Industries and Production, Shafqat Naghmi that stock with Punjab stood at 748,162 MT till November 6, 2013 which was far higher than the actual stocks available with the mills. An Islamabad-based sugar sector insider told Business Recorder on Wednesday that sugar stock with the Punjab stood at 260,000 MT on October 31, 2013, expressing surprise over a misstatement by the Cane Commissioner with the backing of PSMA and Association member sitting in the meeting, who did not challenge the exaggerated data.

Official documents available with Business Recorder revealed the SAB meeting was apprised that total sugar stocks stood at 923,950 MT as of November 4, 7 and 4 in Punjab, Sindh and KPK, respectively. However, sugar sector insider claims that if 500,000 MT of overstated stock is excluded from the total, it stands at 423,950 MT. An official of Industries Ministry told this scribe on Tuesday that total sugar stocks stood at 882,000 MT and sufficient till January 25, 2013 @ 3,90,000 MT per month.

Official documents discussed at the meeting disclosed that the TCP has 57,876 MT of sugar stock as on November 2013. The ECC of the Cabinet, in its meeting on November 7, 2013, had allowed TCP to procure 50,000 MT more from domestic sugar mills. The documents further reveal that sugar mills have exported 1,002,420 MT of sugar against the quota of 12, 00,000 MT and 3,490 MT against quota of 500,000 MT till November 8, 2013.

Contrary to the claims of Federal Government, PSMA President Punjab Riaz Qadeer Butt told this scribe on November 12, 2013 that only 27,000 MT of sugar has been exported so far. The meeting was also apprised that Rs 216.95 million was to be paid to sugarcane growers from sugar millers for season 2012-13, out of which Rs 216.78 million ( 99.92 percent) has been paid so far. Mill owners still have to pay Rs 170 million to the growers of which Rs 90 million is against Punjab-based mills and Rs 80 million is against Sindh -based mills. Sugar mills based in KPK have cleared growers'' dues.

Officials in the Industries Ministry and one of the top PSMA office bearers have also acknowledged that sugar millers usually float black stocks( not mentioned in the books) in the market and pocket substantial amount from undeclared stocks. However, the PSMA office-bearer was of the view that black stocks are floated during the initial days of crushing season and presently actual sugar figures are mentioned. This is the first time when an office-bearer of PSMA acknowledged that the undeclared stocks are being sold in the market. Last year, FBR had appointed inspectors at mills to examine stocks and the practice to continue this year.

Copyright Business Recorder, 2013

Sugarcane Interculturing with Bullock

Sugarcane Interculturing with Bullock mounted tool for "weed control, loosening of soil & earthing" perception: by breaking main shoots, more tillers will emerge..........I disagree with that perception......these r the tillers which will give u good yield & sugar recovery in the end..........for rest there r better options available.

By Hadi Laghari

Sand, Sugarcane & drip irrigation

This is how sugarcane is loaded "Tractor mounted Trolly"

This is how sugarcane is loaded "Tractor mounted Trolly" nearly ready to be transported to sugarmill.......there are also other options like trucks, donkey, camel & bullocks carts..........

But i like this method of loading.......no matter it has some technical faults with regard to cuts ,freshness & wt loss but it is much safer on the roads.........

Wheat sowing in sugarcane field after onion harvest(triple cropping)

Agricultural scenario 2012-13

By Dr Aamer Irshad

LAST year, the agricultural sector achieved a growth rate of 3.1 per cent against the target of 3.4 per cent.

Low production of wheat and some minor crops was the main cause of missed targets despite better harvests of some major

crops like cotton, sugarcane and maize along with satisfactory performance by the livestock sector.

Bad weather and floods predominantly remained the major causes of lower agricultural output.

In the same year, GDP growth was recorded at 3.7 per cent , lower than actual target of 4.2 per cent but above the revised target of 3.6 per cent and also the three per cent in 2010-11.

The positive correlation of agricultural GDP with the overall GDP suggests that agriculture is a significant factor in determining the economy’s performance. Keeping in view the thrust of growth of agriculture sector, a target of 4.1 per cent was fixed for this

year.

The targeted growth was based on the expected contributions by the major crops ( four per cent ), minor crops (4.5 )), livestock (4.2), fisheries (two) and forestry (two per cent).

The projections for major crops were based on the output of 25.5 million tonnes wheat, 6.9 million tonnes rice, 59 million tonnes sugarcane, 14.5 million bales of cotton, and 4.3 million tonnes of maize. The assumption was based largely on the level of production already achieved along with the performance over the last three years. Minor crops such as gram, onion and sunflower remained extraordinarily low because of unfavourable weather conditions last year. It was expected that performance of minor crops will revive and contribute positively towards the overall agricultural GDP.

For the crop sector, key contributing factors, including weather conditions, have remained comparatively better. Agriculture credit disbursement is increasing along with availability and use of fertiliser and improved seed. Plant protection measures and farm mechanisation are improving.

The underlying assumptions for the livestock sector, whose contribution in agricultural GDP (55 per cent) is more than the crop sector, are that its performance has been very steady being less prone to vagaries of weather.

The sector has achieved growth of about four per cent for the last many years. The poultry sector also witnessed sustained high growth rates well above six per cent annually.

A big push in growth rate of livestock is, however, not possible due to peculiar nature of the activities and gestation period required for an activity to become productive. The resilience of the livestock supports growth even in worst natural calamities.

Target for fisheries and forestry growth has been fixed at two per cent. The share of both is negligible in agricultural GDP and hence to the overall economy.

In Kharif (or summer) season, major crops like cotton, rice and sugarcane are grown. Wheat is only the major crop of Rabi or winter season.

The Kharif season is already over. Provisional production data available from Suparco indicate that about 13.9 million cotton bales of standard weight (170 Kg) will be produced this year. The production of sugarcane and rice can be anticipated at 68.5 and 7.2 million tonnes respectively.

If the production of minor crops is assumed normal and the livestock sector follows the fixed growth pattern i.e. around 4.1 per cent per year, wheat remains the only decisive factor to determine the actual agricultural GDP for 2012-13.

With the available data of cotton, rice, sugarcane and anticipated achievement of livestock sector, the performance of agricultural GDP may be viewed in two scenarios depending upon the production of wheat crop in ensuing season. In one instance, if wheat harvest meets the target of 25.5 million tonnes, the agricultural GDP will record a growth rate of 4.6 per cent.

However, if it misses the target by one million tones, the agricultural GDP will comfortably surpass the target figure of four per cent.

Wheat productivity largely depends on weather conditions along with the availability of critical inputs in the coming Rabi season. Weather is single most important factor in wheat production. Pre-Rabi rains provide moisture for timely sowing in rain-fed wheat growing areas which contribute to around 15 per cent towards overall production.

Likewise rains during the growth period of wheat especially in December, February and March are very significant. Intensity and duration of frost, fog and temperature in the later part of the wheat plant life are very decisive. Because of the non filling of Mangla reservoir up to the level of last year i.e. 1210 feet, comparatively less irrigation water will become available for wheat crop but it may not affect the overall productivity, being strongly linked with other factors of production. The factors under human control such as timely sowing with certified seed, balanced fertiliser use, and good crop husbandry will also have significant impact on wheat production.

Presently, the agricultural outlook appears positive. Policy and overall sector environment suggests a healthy growth in agriculture sector. Due to strong vertical and horizontal linkages of agriculture with the country’s economy, a high level of economic activity is expected. Most importantly, food security will be ensured for the ongoing as well as for the year to come.

Heavy dependence of overall GDP on agriculture also suggests a better overall economic performance .

The writer is Chief, food and agriculture, Planning Commission

Original Article Here

Agriculture sector roundup: UR Associates

UR Associates has come out with its report on agri sector. According to the research firm, Rashtriya Chemicals and Fertilisers (RCF) will invest Rs 40 billion in next three years to ramp up its urea capacity at Thal plant near Mumbai. The selection process for lumpsum turnkey contractors (LSTK) for main plants has been completed. The project cost is expected to be Rs 40 billion and will be completed in 36 months period from the zero date.

Pulses sowing picking up

For the first time during this monsoon season, the rainfall was 6% above normal for the week August 23rd-29th. The strong rainfall has improved the deficiency situation further and has brought down the overall deficiency for the monsoon season to 12% below normal. Hence, the rainfall deficiency has come down from 19% at the beginning of the month to 12% at the month end. The deficiency in the Northwest region is the highest at 15% followed by East & NorthEast India (14%), South Peninsula (13%) and Central India (10%)

The pulses sowing has picked up quite significantly during the last one week with the gap between normal pulses acreage and pulses acreage this season coming down to 0.36 million hectares compared to 1.11 million hectares at the beginning of the week.

While rice, sugarcane and cotton are ahead in terms of acreage, coarse cereals are still lagging behind by 2.89 million hectares compared to normal sowing.

RCF to invest Rs 40 billion to ramp up urea capacity

Rashtriya Chemicals and Fertilisers (RCF) will invest Rs 40 billion in next three years to ramp up its urea capacity at Thal plant near Mumbai. In a communique to the BSE, RCF said: "The Company has plans to expand the capacity of urea at Thal by setting up one single stream ammonia plant of capacity 2,200 TPD (tonnes per day) and one single stream urea plant of capacity 3,850 TPD at the existing site." "The selection process for lumpsum turnkey contractors (LSTK) for main plants has been completed. The project cost is expected to be Rs 40 billion and will be completed in 36 months period from the zero date," it said.

Maharashtra to begin 2012-13 sugarcane crushing season from November 1

Top sugar producer Maharashtra will begin its sugarcane crushing season from November 1. The state government was thinking to advance the crushing season by a month as a measure to make more cane available for crushing, which is being diverted every day for use as fodder in drought areas in the state.

Contingency plan to Tackle Drought like Situation

Ministry of Agriculture has prepared Contingency plans for 353 districts across the country for implementing location specific interventions to sustain agriculture production. Subsidy on seeds has been enhanced to partially recompense the farmers for the expenditure in re-sowing and/or purchasing drought tolerant variety of seeds. In view of deficient rainfall, states such as Punjab, Haryana, and Uttar Pradesh have been allocated with additional power from Central Pool. In so far as fertilizer prices are concerned, Urea is provided at a fixed Maximum Retail Price (MRP) of Rs. 5310 per metric ton since 01.04.2010. Nutrient Based Subsidy (NBS) Policy is being implemented on Phosphatic and Potassic (P&K) fertilizers under which a fixed subsidy is provided based on its nutrient content. MRP is fixed by fertilizer companies. The prices of P&K fertilizers have increased mainly due to increase in international prices of fertilizers and due to depreciation of Indian rupee. However, Government provides subsidy to the extent of 50% to 67% of the delivered cost on these fertilizers.

Deepak fertilisers not to develop $350 mn plant in Australia

Indian fertilisers and petrochem firm DFPCL has abandoned plan to build a $350 million plant at Port Bonython, South Australian Mining minister Tom Koutsantonis has said. Deepak Fertilisers and Petrochemicals Corporation Ltd has informed the state government of its intention not to go ahead with a proposed technical ammonium nitrate plant near Whyalla, said Koutsantonis, who also holds the Manufacturing, Innovation and Trade portfolio.

Dhanuka Agritech launches new products

Dhanuka Agritech Limited, a provider of crop protection solution, has launched three agrochemical products in Tamil Nadu. According to Abhishek Dhanuka, Director South Zone, one of the new products is an insecticide that can tackle sucking insects in cotton, vegetable, fruits, cashew and tea. The other, Fluid, is to fight larval insecticide in major crops, while the third one, Fuzi Super, is a herbicide for paddy. The Rs 6.5 billion company has tied up with global firms such as Dupont, Syngenta and Dow Agro Sciences to introduce international proven products in the Indian market, according to R.G. Agarwal, Group Chairman.

Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.

Original Article  Here

Agriculture sector cushions 2011 slump of NorMin economy

Northern Mindanao’s Agriculture sector, which posted a three-percent growth from 2010 levels, cushioned the region’s economic slowdown after the decline in the Industry sector and the decelerated growth in the Service sector threatened to pull down its economy further in 2011.

The Agriculture sector, comprising of agriculture, hunting, forestry and fishing, showed an accelerated growth of 5.9 percent in 2011 from 2.9 percent in 2010, whereas

the Industry sector showed a decline by 2.9 percent last year from 2010 levels of 10.2 percent while the Service sector only managed a growth rate of 4.5 percent in 2011 from 7.1 percent in 2010.

Northern Mindanao’s Agriculture sector contributed 8.9 percent to the growth of the Philippines’ Agriculture sector in 2011, said Brenda Lynn M. Castro, officer-in-charge of the National Statistical Information Center of the National Statistical Coordination Board-X (NSCB-10).

The Philippine Agriculture sector grew by 2.34 percent in 2011, bannered by the crops, livestock and poultry sub-sectors.

The region’s Agriculture sector also topped in Mindanao, holding 26.8 percent of the island’s overall Agriculture performance in 2011.

The growth in Northern Mindanao’s Agriculture sector was attributed to the increase production of palay, sugarcane, pineapple, livestock and chicken, Castro said.

However, Fishing dropped in growth to -0.8 percent in 2011 from 3.8 in 2010 due to the decrease in commercial and municipal fishing, and aquaculture.

  Agriculture comprised 28 percent of Northern Mindanao’s economy. The Service sector accounted for the biggest share of the region’s economy at 41.8 percent while the Industry sector accounted for 30.2 percent of the region’s economy.

In 2011, Northern Mindanao’s economic growth was only 2.5 percent, a slowdown from its 6.9 percent growth in 2010, mainly because of the decline in the Industry and Service sectors.

But the region’s economic slump last year was not an isolated case because 10 other regions in the country posted decelerated economic growth. Only 5 of the Philippines’ 17 regions showed improved economic performance while one region showed a negative growth rate.

Castro said the slump in Northern Mindanao’s economic performance in 2011 was due mainly to the negative growth of the Industry sector, pulled down by the negative performance of the construction sub-sector which nosedived last year, posting -27.2 percent from 10.8 percent in 2010.

Original Article Here

Punjab’s lost growth momentum

By Nasir Jamal 

PUNJAB’S regional economy has increased at a much slower pace than ‘the rest of Pakistan’ over last four financial years to 2011, a trend that must be reversed to create jobs and reduce poverty.

The province’s annual average growth rate of 2.5 per cent between 2007 and 2011 lags far behind 3.4 per cent for the rest of Pakistan,according to a report of the Lahore-based Institute of Public Policy (IPP).

The report – The State of the Economy: The Punjab Story – estimates the provincial gross regional product (GRP) to have expanded by 5.6 per cent, or slightly faster than the national average of 5.5 per cent and the rest of Pakistan average of 5.4 per cent between the financial years 2000 and 2007 before falling sharply in the following years.

The average provincial growth rate of 4.5 per cent during 2000 and 2011, nevertheless, falls behind the national average of 4.6 per cent and the rest of Pakistan average of 4.7 per cent. Between 2000 and 2011 the average growth rate of Punjab has been 0.2 percentage points less than that of the rest of Pakistan. However, much of the growth shortfall experienced in Punjab has been in the last four years, the report says.

The IPP growth estimates for Punjab should be instructive for the Shahbaz Sharif government as it prepares the provincial budget for 2012/13, promising to provide relief to people in the run up to the new election early next year. By implication, the report has been quite critical of the government’s development priorities that have done little to address structural weaknesses and infrastructure gaps responsible for dragging down the provincial economy. It also advises the government to reset its development priorities to push growth rate to combat rising unemployment.

It also accuses the previous government of Chaudhry Pervaiz Elahi (2002/07) of overstating growth rate for its tenure, saying Punjab grew at 6.6 per cent during financial years between 2003 and 2007 compared to the national average of 6.8 per cent and the rest of Pakistan average of seven per cent. Official estimates for the said period claimed that the province had grown at an average pace of 7.5 per cent, faster than the national average of 7.3 per cent and the rest of Pakistan average of 7.1 per cent.

The report says unemployment has increased significantly since 2007/08 because of the falling growth. “The economy of Punjab will have to grow at a rate of above six per cent on a long-term basis if increasing unemployment is to be avoided,” it argues.

It estimates the per capita GRP of Punjab at Rs97,492 or $1140 per annum in 2011, or two per cent lower than the rest of Pakistan.

The slowing regional growth has led to contraction in Punjab’s share in the national economy to 54.9 per cent in 2011 from 55.5 per cent in 2000 and 55.7 per cent in 2007.

Punjab’s economy, according to the  IPP, is composed of 24 per cent agriculture (17 per cent for the rest of Pakistan and 20.9 per cent for Pakistan), 21.2 per cent industry (31 per cent for the rest of Pakistan and 25.8 per cent for Pakistan) and 54.8 per cent services (52 per cent for the rest of Pakistan and 53.3 per cent for Pakistan). The provincial economy’s sectoral composition signifies relative importance of agriculture in its economy and underdevelopment of industry as compared to the rest of Pakistan, says the IPP.

The report identifies three major factors that have dragged down economic growth in Punjab in recent years: decreasing water availability for agriculture, growing energy crunch for industry and declining public sector investment in economic infrastructure.

The IPP points out that performance of agriculture plays a major part in the economic growth of the province. During the last few years, it contends, the performance of agriculture sector has been disappointing, especially of major crops that have shown little growth since 2007 due to growing water shortages and rising fertiliser prices. Wheat production was virtually stagnant and output of sugarcane and cotton dropped by 10 per cent and 17 per cent respectively. The only crop with significant growth of 26 per cent was rice. In addition, there was hardly any growth in minor crops. Given the relatively large share of agriculture in the regional (Punjab) economy, the growth rate is likely to be lower because even in good years agriculture is unlikely to average a growth rate above four to five per cent,” it underlines.

The annual average agriculture growth rate in Punjab declined to just one per cent between 2007 and 2011 from 3.3 per cent between 2000 and 2007. In contrast, the average agriculture growth rate rose to three per cent for the rest of Pakistan from 2.5 per cent.

Growing energy shortages have affected industrial output in Punjab disproportionately, according to the report. There has been cumulative drop in gas consumption in the province of 13 per cent in the last few years compared to an increase of 16 per cent in the rest of Pakistan, especially in Sindh.

Similarly, increase in electricity consumption since 2007 has been restricted to only two per cent compared to six per cent in the rest of Pakistan. Punjab’s share in the national production of cotton yarn, for example, dropped from 33 per cent in 2007 to 29 per cent in 2011 and in cotton cloth from 43 per cent to 37 per cent.

Additionally, the report underlines the weaker presence in Punjab of industry producing consumer durable and construction inputs compared to Sindh as another factor for slower growth. “In the peak of business cycle, industries producing consumer durables like automobiles and industries providing construction inputs like cement show very high growth rates. During 2003 and 2007, for example, production of automobiles showed extraordinarily high growth rate of 31 per cent. The growth rate of cement industry was also high at 18 per cent.

These industries, which are sensitive to business cycle, have larger presence in the rest of Pakistan, particularly in Sindh, and further push the growth rate of this region during periods of high growth.”

In spite of these factors, the decline in industrial growth in Punjab to 3.3 per cent between 2007 and 2011 from 6.9 per cent between 2000 and 2007 has been far less marked than in the rest of Pakistan where it dropped to just 1.6 per cent from 7.8 per cent. The national average has come down to 2.3 per cent from 7.4 per cent.

The report further argues that the export boom has been more advantageous for the industries closer to the port in Karachi than the ones in Punjab. “The good performance of manufactured exports between 2003 and 2007, with an annual growth rate in excess of 14 per cent clearly meant that units located closer to the port were in an advantageous position to exploit these opportunities than the ones in Punjab.

Consequently,the textile sector of Sindh benefited more from the export boom.”

Punjab’s services sector too has performed poorly compared to the rest of Pakistan in the years between 2007 and 2011. While the sector grew by 3.6 per cent in Punjab, it expanded by 5.3 per cent in the rest of Pakistan. The growth rate in the province’s services sector has come down from 6.3 per cent between 2000 and 2007 when the rest of Pakistan increased its services sector by 5.2 per cent.

Punjab’s share in taxes also appears to have declined during the years of falling growth. The province’s share in direct tax collection, for example, is estimated to have dropped to 33.7 per cent in 2009/10 from 34.2 per cent in 2006/07. Its share in excise duty too has plunged to 42.9 per cent from 53.2 per cent. But the domestic sales tax collection from Punjab grew to 44 per cent from 29.9 per cent.

“The decline in Punjab’s share (of direct tax collection) tends to indicate that the non-agricultural GRP of the province may have grown at a

somewhat lower rate than the rest of the country’s. The relatively low share of Punjab in revenues compared to its population may also be noted. The highest incidence of taxes is on the large-scale manufacturing sector and Punjab has a relatively low share in the national value added in this sector,” the report says.

The IPP is of the view that Punjab’s development priorities must focus primarily on removing constraints – large infrastructure gaps of water availability for agriculture and energy for industry – to growth.

“Currently, the Punjab government devotes less than one-third of its annual development programme (ADP) to infrastructure development. This share will have to be raised substantially and the inter-sectoral allocation will have to shift from highways to irrigation schemes and power projects.”

The development strategy must also focus on sectors and sub-sectors in which it has a comparative advantage. This will include policies and programmes to develop the yields in major crops, minor crops (especially fruits and vegetables), milk production and marketing, poultry, agro-based industry, small and medium enterprises and services sector. It advises the provincial government to draw up a plan to maximise gains that liberalisation of trade with India offers.

And last but not the least, it urges the government to follow a more expansionary fiscal policy with the objective of achieving a quantum jump in the size of its ADP to remove infrastructure gaps dragging growth in the province. “This will require a more aggressive policy of resource mobilisation involving the development of provincial taxes on services, agricultural income and real estate.”

But the Shahbaz Sharif government, which has so far dithered on theissue of increasing provincial own tax resource, is unlikely to heed to the IPP suggestions, its critics say. “I don’t see the provincial government effectively taxing the under-taxed or untaxed sectors in the next year’s budget. Nor do I think it will shift whatever financial resources it can muster for development to such irrigation and energy projects that will take some time to complete. I believe that it will continue to spend money on schemes that can bring it immediate political dividend in the election year rather than those whose benefits will accrue after a few years,” comments an economist.

Original Article Here

India Sugarcane Expected to Continue Strong Growth

INDIA - Sugarcane production in India for 2012/13 is expected to continue its strong growth for the third consecutive year. Sugarcane area plantings are expected to expand 3 per cent to 5.25 million hectares. Sugarcane production is forecast at 365 mmt, about 5 per cent more than last year.

Of this amount, 270 mmt is intended for centrifugal sugar production. The remaining 90 mmt is for seed (46 per cent), noncentrifugal lump sugar, or gur (47 per cent), and khandsari sugar (7 per cent).

Although domestic wholesale sugar prices have been soft, between $540 and $600 per mt, the prospect of strong export sales is expected to help processors maintain strong cash flows and avoid cane payment arrears to producers. Sugar production is forecast at 29.00 mmtrv, or 29.75 mmtrv if khandsari (a lowrecovery form of centrifugal sugar) is included.

Sugar consumption in 2012/13 is forecast at 26.5 mmt, about 3.9 per cent higher than in 2011/12. The growth is aided by a 1.8-per cent increase in population and the expectation of continued overall growth in the economy.

The Government of India reduced the import duty on high fructose corn syrup (HFCS) from 30 per cent to 20 per cent. Although this reduction favors more HFCS imports, it remains to be seen if HFCS can capture industrial sweetener consumption at anything above the 5,000 mt estimated for 2010/11.

Indian 2012/13 sugar exports are projected at 2.5 mmtrv. In 2011/12, the Indian Government has allowed 3.0 mmt of exports under the Open General License (OGL). Exports for 2011/12 through the end of March are estimated at 1.3 mmt.

Based on pace to date, total 2011/12 exports will total 2.6 mmt. To guard against food-price inflation without restricting exports, the Indian Government has relaxed sugar import restrictions. The elimination of duties on both raw and refined sugar, expected to last through 2012/13, is especially important. Since December 2011, Government-imposed stockholding limits have also been lifted.

Ending 2012/13 sugar stocks are forecast at 7.28 mmtrv, about 750,000 mtrv more than projected beginning stocks. This amount is considered to be a normal level, corresponding to 3 months of domestic consumption needs.

Original Article Here

Food Processing and Value Addition

Processing of food is of enormous significance for Pakistan's development because of the vital linkages and synergies that it promotes between the two pillars of the economy, namely Industry and Agriculture. This growth of the Food Processing Industry will bring immense benefits to the economy, raising agricultural yields, meeting productivity, creating employment and raising the standard of very large number of people throughout the country, specially, in the rural areas. Economic liberalization and rising consumer prosperity is opening new opportunities for diversification in Food Processing Sector. Liberalization of world trade will open up new vistas for growth. The Food Processing Industry has been identified as a thrust area for development.

APPROACHES TO FOOD PROCESSING IN PAKISTAN

In contrast to the described approach adopted in industrialized countries, food processing in most developing countries (including Pakistan) involves very basic and sometimes crude approaches. The food and its allied products industry is considered Pakistan's largest industry, and is believed to account for 27% of its value-added production, and 16% of the total employment by the manufacturing sector About 75% of the rural-based food manufacturers are in the so-called informal sector. This informal economy is unregulated and finds difficulty in accessing essential raw materials and other resources especially finance skills, knowledge and management. Marketing and quality (especially hygiene) standards are especially lacking. Employment pays low wages and uses the skills of the most ill-educated.

THE FOOD PROCESSING SECTOR AND AGRICULTURE RAW MATERIAL

Food processing involves any type of value addition to the agricultural produce starting at the post harvest level. It includes even primary processing like grading, sorting, cutting, seeding, shelling packaging etc. this sector involves the processing of following heads.

Fruits and Vegetables

Pakistan's climate is suitable for the production of various horticultural crops. Punjab dominates the production of both fruits and vegetables, accounting for 63% and 60% respectively. Citrus and Mango are two important fruits which are consumed either fresh or used for juice manufacturing. Together these two fruits in Punjab alone account for 48% of all fruit produced in Pakistan. Balochistan produces the second largest volume of fruit, mainly apple and dates. For vegetables, again Punjab dominates with the production of potato. Little has changed in production technology, harvesting practices, packaging and post harvest care within the horticulture industry over the last decade. As a result the industry has been unable to establish itself in export markets or indeed to significantly improve the volume of output. The lackluster performance of the horticulture industry in Pakistan is due to inadequate harvesting and post-harvest procedures and poor infrastructure, especially cold storage.

Genreally fruits and vegetables are consumed as fresh. There is a small fruit and vegetable processing industry, which is concentrated around the major cities. Sind province is famous for best quality of dates. There are only two date processing plants in Khairpur city and is an enormous potential for the date processing plants. There are 25 small and medium industrial units, having an estimated capacity of 45,000 mt (metric tons), engaged in the production of squashes, jams and jellies, pickles and a meager quantity of canned fruits and vegetables. In the view of value-addition, production of canned fruits is estimated at 15,000 mt; jams, jellies and marmalades at 2,000 mt; pickles and sauces at 10,000 mt and syrup and squashes at 18,000 million bottles. Most of the producers of these products are based in the urban areas. Approximately 30 fruit juice and pulp processing plants with an installed capacity of 500,000 mt per annum are engaged in the production of fruit juices and fruit drinks.

Cereals

Wheat is Pakistan's largest food grain crop, and accounts for about 40% area under cultivation. It is estimated that about 80% of the farmers in Pakistan cultivate the wheat. Punjab is the largest rice-producing province with 60% of rice planted area followed by Sindh with 32%. Only a small proportion of rice is traded internationally, by far the most is consumed in producing countries. As a result the world price of rice can move within a wide range from year to year adding instability and uncertainty to the market. Different value added products could be made from the cereals like biscuits, Starch Glucose, Cornflakes, Malted Foods, Vermicelli etc. The basic quality of the flour which as stated is relatively poor, the smaller manufacturers cannot afford to include the necessary additive to fortify the flour that make the product into a useful part of the diet. In this respect the PFMA( Pakistan Flour Mills Association) has joined with the government to work on a program that does encourage the fortification of flour.

As for as rice is concerned Pakistan enjoys a natural comparative advantage in basmati rice production which has an assured market in several foreign countries. This has led to the growth of rice processing industries which fulfill the quality requirements of the foreign customers.

Oil seeds and vegetable oils

Pakistan was self-reliant in edible oils during 1947 to 1960. The import of edible oils started in 1960. During 2006-07, domestic production of edible oil was 0.855 million tons. The major oilseed crops include cottonseed (478,000 tons), rapeseed/mustard (63,000 tons), sunflower (249,000 tons) and canola (65,000 tons). The import in 2006-07 has reached 2.55 million tones. During this period, 2.201 million tons of edible oil was imported and 0.349 million tons edible oil was recovered from imported oilseeds. The total availability of edible oil from all sources amounted to 3.405 million tons (GOP, 2006-07). Despite the fact that Pakistan is overwhelmingly an agrarian economy, it is unable to produce edible oil sufficient for domestic requirements and substantial amount of foreign exchange is spent on the import of soya bean and palm oil. The imports constitute about 70 per cent of total consumption mainly palm oil from Malaysia and soybean from US of worth $731.0 and $32.2millions, respectively. Translated in terms of foreign exchange it comes to colossal amount, which is a heavy drain on our already afflicted national economy.

Sugarcane
Sugar is the second most important cash crop in Pakistan after cotton. Government of Pakistan has been heavily involved in the sugar industry, regulating mill construction, trade and prices, and influencing farmers' crop decisions in various ways. Pakistan grows about one million hectares of sugarcane, more than all other cane producing countries except Brazil, China, Cuba, India and Thailand. Punjab accounts for about 65% percent or about 650,000 ha of the area under sugarcane. Other producing areas include Sindh which accounts for about 30% percent of sugarcane land, the Northwest Frontier Province (NWFP) about 10%, and Balochistan which accounts for less than 1%. Pakistan's sugarcane yield averages about 46 tons per hectare, well below the world average of above 60 tons, and below neighboring India's yield of 65 to 70 tons. There is overcapacity in the sugarcane industry that leads to loss of profitability for the individual mills, some of which have closed. Overcapacity resulted from favorable market conditions that encouraged investment

Meat and Poultry

The domestic livestock population is about 23 million cattle, 25.8 million buffalo, 25 million sheep and 53 million goats. Livestock accounted for about 39 percent of agricultural value added and about 9.4 percent of GDP. Net foreign exchange earnings from livestock products and by products like meat, skins, hides etc is about 11 percent of the overall export earnings of the country. Meat products are usually available in the form of frozen packed mainly in the fresh form in Pakistan. Frozen meat products and sausages is an emerging area in meat processing in Pakistan. Mostly meat is consumed in the countryside or via small-scale slaughters in the urban areas. There are very few large-scale animal slaughterhouses and meat packing factories. In this respect, Pakistan is probably one of the world's least efficient users of livestock resources since home-based slaughtering generally does not make most efficient use of the by-products.

Milk and Dairy

Pakistan claims to be the fifth largest producer of milk by volume in the world. Average daily production of milk is about 130 million liters. Analysis for Pakistan found that the most livestock net income comes from local cows, buffalo, and bullock. These animals account for 80 percent of net annual per capita livestock income. Major value added dairy products which are commonly consumed in Pakistan are Whole Milk Powder, Skimmed milk powder, Condensed milk, Ice cream, Butter and Ghee. The strategic development of the dairy industry is being managed by the Ministry of Industries, Productions and Special Initiatives as one of the key sectors for development of dairy sector on priority basis. A Strategy Working Group (SWOG) was set up in 2004. The SWOG includes members from prominent stakeholders in the industry who are working together voluntarily to identify issues and propose a strategic framework. SMEDA has provided support and facilitated the group. In addition, the Pakistan Dairy Development Company "Dairy Pakistan" was registered as an independent not-for-profit company to further refine sector strategy and design, implement initiatives identified for the development of the sector.

THE VALUE CHAIN IN FOOD PROCESSING

The food processing industry in Pakistan faces a number of critical challenges which includes :

• Post harvest losses due to lack of storage and transport infrastructure Integrating the individual food factories with backward and forward linkages
• Ignorance from quality management systems
• Lack of coordination links with academia, industry and research organizations
• Weak regulatory system
• Lack of investment in the supply chain
• Unequipped food analysis laboratories
• Inefficient market structure
• Lack of adequate trained manpower
• Rural poverty and malnutrition

Rules for maximizing value addition in food chain in Pakistan

Agriculture :

High productivity of the desired raw material must be determined which is the need of the food industry. A demand driven approach must be followed.

Intermediate processing :

High standards of post harvest handling and storage facilities are critical. It is essential that intermediate processors have close understanding and relationship with the final manufacturers. In order to reduce the cost and for the consistent availability of good quality raw material it is recommended that the processing facilities should be installed near the source of the raw material.

Food Manufacturing :

Food manufacturers have some issues as follows :

• Inability to manage raw material supply
• Higher inputs cost and poor labor skills
• Poor financial support for R&D
• Poor technical choices and a lack of innovation
• Poor safety standards

THE POLICY AND STRETGY

The Policy will seek to create an appropriate environment for entrepreneurs to set up Food Processing Industries through The government's Agricultural Policy focuses on :

• Sustainable food security
• Increasing productivity
• Commercial agriculture
• Income diversification
• Export orientation
• Simplification of food laws

STRATEGY :

The key policies and strategies of the Government of Pakistan related to food processing technologies are as follows :

• Agriculture will be diversified into high-value crops. Special emphasis will be laid on growing fruits and vegetables for the export market. The private sector will be encouraged to establish processing, grading, packaging, refrigeration and storage, etc., through provision of liberal credit.
• Strengthening the process of agricultural modernization by increasing productivity through vertical expansion, diversifying agriculture into high- value crops, and improving the pricing, marketing, grading and distribution systems to improve farmers' income.
• Fruits and vegetables processing and preservation plants and export companies will be established in growing areas of these commodities.
• Post-harvest handling and preservation of fish catch will be improved by providing chilling/refrigeration system in the traditional boats through the financial assistance of Small and Medium Enterprises Development Authority (SMEDA).

FUTURE PROSPECTS :

A reasonable work has been done in Pakistan on secondary processing of agricultural produce, however, the area of primary processing of agriculture produce is not yet developed, therefore, tremendous potential exists in this area.

• The key low-cost technologies needed are as follows :
• Seed / grain drying, aeration and storage technology
• Application of extrusion technology in cereals
• Rice drying technology for obtaining higher head rice yield
• Efficient dal (pulses) processing technology
• Rice par-boiling technology
• Apricot and dates drying and processing technology
• Modified atmosphere technology for fruits and vegetables
• Pre-cooling technology for fruits and vegetables
• Cool stores for potatoes, citrus, and apples
• Fruits and vegetables cleaning, grading, and packing technology
• Small-scale fruit juice technology for the remote fruit growing areas

SUGGESTIONS :

• Focus on agro- based processed products rather than fresh crops
• Development of linkages between industry and research organizations
• Development of specific agro-processing zones
• Focus on brand building
• Awareness among consumers
• Improving process efficiency and decreasing losses
• Need a stronger information base for farmers

Dr. Faqir Muhammad Anjum and Ali Asghar

Courtesy Agrihunt.com