THE Khyber Pakhtunkhwa food department hopes to procure the targeted 0.325 million metric tons of wheat this year. This is in contrast to half the targeted 0.4 million metric tons procured last year.
KP Food Director Anwar Khan said around 85 per cent of the target has been achieved.
“Hopefully the purchase target would be met this year for we made early preparations, arranged/provided enough gunny bags to growers and started the process well in time. Another incentive was the raised official support price to Rs1050/40kg from Rs950/40kg last year,” he said.
The cost of procurement at the rate of Rs26,250 per metric ton works out to Rs8.5bn out of which Rs6.5bn has been provided by Bank of Khyber and Rs1bn each by the First Women Bank and Bank Alfalah at equal lending rates of kibor+2 per cent which is lesser than the rate offered to Punjab and Sindh.
“The banks were selected after open bidding and the food department would reimburse their money after it sells the commodity to millers,” he said.
KP usually misses the wheat procurement target owing to reluctance of farmers to sell their yield meant for domestic consumption, shortage, distant location of procurement centres and lack of storage facilities etc.
“There are too few procurement centres. Most are located in cities far from the village wheat farms. Some districts like Kohistan, Shangla, Swabi, Buner etc. don’t have procurement centres,” said a Peshawar-based farmer Khalil Khan.
Strangely, this year out of the 25 districts of the province only 19 had procurement centres with only 14/15 functional. Swat, Dir Upper and Lower, Buner and the wheat-rich Swabi districts had no procurement centres at all.
When asked, the official said: problem of storages in Buner and Swabi and high transportation costs in Swat and Dir districts made procurement unfeasible. “You can’t buy wheat in Shangla and Kohistan as it would be too costly,” he said.
“It is mind-boggling and depressing that the government didn’t open procurement centres and offer suitable alternatives to growers against the middlemen in the far-flung militancy-hit districts where poverty is more severe,” said Sharif Gul, a Swat farmer.
The official said wheat and flour requirement of the province and the tribal belt was over 4MMT of which around 1.1MMT was locally produced and the rest was purchased from Punjab and provided by Passco to flour mills at subsidised rates. This year Rs2.5bn had been allocated for wheat subsidy in the budget.
“KP has a cumulative storage capacity of 0.335MT which is going to be doubled by 2017 under a farm development strategy prepared by KP to ensure maximum procurement,” the official said.
The meagre storage capacity hinders maximum direct procurement which deprives the province of savings of billions of rupees. Direct procurement could saves around Rs6,000 per ton if it could procure all the 4MMT of its target from the open market.
KP had allocated Rs540mn for construction of eight storage centres this year.
However, this was not enough. KP maintains a wheat stock of around 0.3MT to ward against artificial shortage and price-hike which, according to the official, is sufficient for three months. But the figure seems unrealistic keeping in view the total 4MMT wheat requirements for 12 months.
Against the practice in other provinces, KP rarely hires private godowns to increase its wheat storage capacity.
A farmer Ahmad Khan said the government should increase procurement centres and construct modern silos at tehsil levels, if not at village levels.
Farmers complain of shortage and maldistribution of gunny bags. The official reject the allegations saying gunny bags are given to growers on first-come-first-served basis.
“Gunny bags are given to farmers depending upon the storage capacity and procurement target. Vigilance committees oversee the process. The farmers have to apply to the District Food Controller (DFC) before the harvesting season and deposit the required money in designated accounts. “We had over 2.5mn bags of left-over stock and some were purchased this year. Rest of the wheat was packed in plastic bags or gunny/plastic bags brought by farmers themselves,” he said.
The official also rejected allegation of delay in payment to farmers. “Right after they bring their wheat and it is purchased, they are paid. The price/security money of gunny bags they deposit earlier,” he added.
Farmers complain they are compelled to approach the ‘agents’ in case of delay in assessment or unwarranted rejection of their wheat.
The official, however, said wheat was selected or rejected by a committee headed by the DFC and having the representatives of the agriculture and revenue departments and the DCO. “If there is too much external material or high humidity in the grain bags, it is rejected,” he said.
Habib Khan, a farmer in Mardan, unaware of the increased official price, sold his crop to a private agent at Rs1,100 per 50/kg, much less than the official support price.