PUNJAB, without doubt, is Pakistan’s food basket. It produces nearly three quarters of the country’s wheat, almost 70pc of rice and more than 80pc of maize, according to the Punjab Economic Research Institute.

But here’s the catch: the province lacks the capacity to properly store these staples. This results in higher post-harvest losses and puts growers at a disadvantage.

According to a document of the Ministry of Food Security and Research, Pakistan’s preventable post-harvest grain losses stand at 20 million tonnes a year, enough to feed 17m people (almost two-thirds of Karachi’s population).

The initiatives will also improve the bargaining position of growers so that they can get better prices for their produce

Though there are no exact figures for Punjab’s storage capacity both in public and private sectors, the State Bank of Pakistan’s data does shed some light on the large gap between the country’s public sector storage facilities and grain yield.

The data suggests that nearly 16m tonnes of wheat and around 4m tonnes of rice and maize need proper storage facilities.

As the Punjab government lacks money and other resources to develop such facilities, the authorities, particularly the food and agriculture departments, are working to woo private investors, and even farmers, to increase storage.

Political and administrative authorities are also trying to take farmers on board and make them stakeholders in the initiatives the government is planning to overcome grain losses.

The initiatives will also improve the bargaining position of growers so that they get better prices for their produce.

The agriculture department is working on a warehousing concept under which farmers with sufficient land are encouraged to build grain stores that are larger than their needs so that they may rent out the facility to nearby small farmers.

The warehouses will be built under the public-private partnership (PPP) model, with the major share going to the landowner. The government will provide them with technical support in building and maintaining warehouses and the grain stored there, says an official privy to the development.

Those who will place their harvested crops or processed agricultural commodities in these warehouses will be offered receipts under a State Bank facility. These receipts will be acceptable as collateral to secure bank loans.

Pakistan Kissan Ittehad Secretary General Mian Umair says Punjab’s Law Minister Rana Sanaullah and the chief and agriculture secretaries are inviting selected farmers for briefings on the new farm warehousing concept and are seeking their input on the likely initiative.

However, Mr Umair says that though the concept seems attractive, it needs to explain certain aspects. For instance, how will it help settle likely disputes between the warehouse owners or contractors and the clients, for political rivalries and biradary differences that exist in almost each village?

To overcome such issues, an agriculture department official says, various measures are being considered. For example, the proposed warehouses will not be larger than a particular size so that there is more than one warehouse in an area to accommodate various groups.

Meanwhile, the food department has invited bids from private investors to construct steel silos to store 400,000 tonnes of wheat.

The department stores 2m tonnes of wheat in the open using a cover-and-plinth storage system which results in a qualitative and quantitative loss of thousands of tonnes of produce because of various factors.

The project was earlier launched in 2011 with financial and technical assistance of the International Finance Corporation, a World Bank unit that helps the private sector in developing countries.

The United States Agency for International Development also extended $1.5m to ensure 4m tonnes of strategic wheat storage and export of the rest of the produce.

But officials say the bidding was scuttled due to a change in priorities of the political government and indifference of some top bureaucrats.

As for the current plan, bids have been invited to construct 10,000-tonne silos in the first phase at 40 different points located within a one-kilometre radius of the existing temporary wheat godowns.

Interested investors will build and maintain the silos and the government will pay them rent for using the facility. The facility will then be taken to all 200 temporary godowns in the next phase.

Mr Umair of the Kissan Ittehad believes that, if truly implemented, the initiatives may help stabilise farm market prices as growers may retain their yields until a better price is available.

Published in Dawn, The Business and Finance Weekly, July 10th, 2017