Pakistan moves to recapture Afghanistan’s wheat market

Pakistan is making efforts to open up a potential 2-million-ton wheat export market in Afghanistan and has begun taking special measures based on demands of exporters.

The move comes after Pakistan Tehreek-e-Insaf (PTI) leader Jehangir Tareen met with Khyber-Pakhtunkhwa (K-P) Chief Minister Mahmood Khan, senior Federal Board of Revenue (FBR) officials and representatives of security forces.

In the first phase, the duration for which goods trucks will be allowed to pass through the Torkham border has been increased to 10 hours and plans are afoot to open the border 24 hours a day for exports by August this year.

Sources said this could save exporters Rs90,000 per truck in transportation expenses. Apart from this, at the suggestion of Karachi exporters, work has begun on a project to reserve high protein and gluten wheat from Punjab and Sindh for export only.

According to exporters, the high protein and gluten wheat from Pakistan can sell for $8 to $10 more per ton in international markets. In the past, Pakistani exporters used to send 1 to 1.2 million tons of wheat to Afghanistan, but due to the government’s uncertain export policies, Pakistan gradually lost the wheat market in Afghanistan and Russian wheat and grain took its place.

Prime Minister Imran Khan has handed over the task of resolution of agricultural issues and adopting measures for agricultural development to his close aide Tareen. In the past few days, Tareen has held high-level meetings with wheat exporters in Punjab, Sindh and K-P in which various suggestions to increase Pakistan’s share in the 2-million-ton Afghan wheat market were considered.

Exporters sending wheat to Afghanistan informed Tareen that currently goods trucks have an eight-hour window to cross the border and in this duration around 250 trucks cross. They said if the border is opened for a longer period, all exports including wheat will increase. Similarly, Karachi exporters told Tareen that they export low protein and gluten wheat, which fetches lower prices in global markets.

Nawabshah, Mirpurkhas, Hala, Bahawalpur, Bahawalnagar, Rahim Yar Khan and other areas in Sindh and Punjab produce wheat with higher protein and gluten, which they said could be stored and exported for higher profits.

When contacted by The Express Tribune, Tareen said he had examined the suggestions in his meeting with K-P’s political leadership and security services, after which in the first phase, the duration for goods carriers passing through the Torkham border has been extended from eight hours to 10 hours.

In April, this duration will be increased to 12 hours, and by August, the Torkham border will be opened for 24 hours a day for exports. “On the demand of Sindh exporters, lab tests of wheat from various Punjab districts have started, so that the percentage of protein and gluten can be determined. After this, we will select the districts producing high protein and gluten wheat and will reserve them for export purposes,” Tareen added.

He said there is a huge wheat market in Afghanistan, which would not only be a source of foreign exchange, but would also benefit Pakistan farmers with higher prices and domestic flour mills due to increased wheat crushing activity.

Speaking to The Express Tribune, Flour Mills Association leader and wheat exporter Hafiz Ahmed said Afghanistan had been a big market for Pakistan in the past, however, uncertain government policies let it slip out of its hands.

“Currently, there is a great demand for Pakistani wheat and grain in Afghanistan because it is much cheaper than Russian wheat, but Afghan traders don’t have trust in Pakistan because they believe we cannot deliver on time.”

The Express Tribune