THE sowing of wheat is in full swing, and initial field information indicates that the crop’s sowing target is likely to be surpassed this season. The Sindh agriculture department has the fixed sowing target at 1.15m hectares against last season’s estimate of 11m ha.

The optimism is primarily owing to early harvesting of the cotton crop and the subsidy of Rs500 on DAP fertiliser bag announced under the kissan package. Favourable climatic conditions also encouraged farmers to go for wheat.

The reported decline in the cultivation sunflower may also boost wheat sowing. As compared to other crops, it is somewhat easier for growers, especially smaller ones, to manage wheat, as the crop is free from virus attacks. Timely sowing of wheat and the application of the required doze of DAP fertiliser are crucial for higher productivity.

And while Sindh didn’t officially announce the wheat sowing target in the 2014-15 season, favourable factors have persuaded the agriculture department to fix this season’s target at 1.15m ha.

Since the third week of October, there has been no abrupt increase in temperatures, as moderate temperatures till the harvesting of wheat in March is necessary for a healthy crop.

Official estimates for the sowing of the crop in Sindh are not based on ground realities. The farmers might opt for fodder crops in view of their experience last year, when they had to sell their wheat crop at a low price

Meanwhile, farmers and chakki owners are looking at how the government will manage the crop if it is in surplus, with regards to support price and prompt purchases.

However, Sindh Chamber of Agriculture General Secretary Nabi Bux Sathio says official estimates for the sowing of the crop are not based on ground realities. The farmers might opt for fodder crops in view of their experience last year, when they had to sell their wheat crop at low prices like Rs1,000 per 40kg.

While the exact figure of last year’s wheat stock has not been officially shared, reports indicate that a sizeable quantity is still lying with the food department. The owners of chakki and flour mills — who obtain wheat from the food department — see international wheat prices declining.

According to Hanif Rajput, a representative of chakki owners’ association, says the market scenario does not appear promising given the current international prices of Rs2,400-2,500 per 100kg and the local support price of Rs1,300 per 40kg.

“The government’s subsidy doesn’t reach farmers in real terms, thanks to anomalies in the food department and its collusion with big traders,” he says.

Wheat is released to millers and chakki owners by the food department from September-October onwards. Before that, the millers are dependent on the local market for their supplies. Consumers get the benefit of this price fluctuation for a brief period when wheat flour is sold for Rs37-38 per kg.

Currently, wheat flour is being sold for Rs42-43 per kg as 100kg wheat bags are being released by the food department at Rs3,340 to chakki owners and millers.

Wheat would be released until February or probably March. When the new crop starts reaching the market, the millers and the chakki owners will start purchasing it at their forecasted rate of Rs2,500-2,600 per100kg (or Rs1,000-1,100 per 40kg).

With the official rate of Rs1,300 per 40kg, the cost of a 100kg bag comes to Rs3,250. Only influential farmers will be able to sell their crop to the food department or to those who grease the palms of food department officials to get gunny bags for supplying wheat.

Traders who lift the new crop from the market for hoarding will also have the chance to manipulate the market once the wheat procurement target is met by the food department by June. They will then gradually start increasing the price of the 100kg bag in the market from Rs2,500-2,700.

Published in Dawn, Business & Finance weekly, January 4th, 2016