Key Takeaways
- Punjab, the country’s only wheat-surplus province, has requested one million tonnes of imports.
- Wheat prices have surged from Rs3,300 to Rs4,700 per 40 kg since harvest.
- The decision raises questions about official production estimates and strategic reserve adequacy.
Pakistan is set to import one million tonnes of wheat as the federal government finds strategic reserves insufficient to meet provincial requirements. This move comes despite a record domestic harvest, with Punjab—the country’s only wheat-surplus province—seeking an additional 1m tonnes.
The surge in wheat prices from Rs3,300 to Rs4,700 per 40 kg since the recent harvest reflects a significant supply-demand imbalance. This price increase is well above the import parity price, indicating that domestic production alone cannot meet current demands.
Adding to the puzzle, poultry feed mills are not consuming wheat this year because maize—preferred by the sector—is considerably cheaper. The border with Afghanistan remains closed, preventing formal exports or cross-border smuggling of wheat, yet prices continue to rise.
The proposed import has revived fears among farmers about a repeat of FY24 when imports triggered a price collapse. This decision highlights the ongoing challenges in balancing the interests of farmers and consumers.
Since Punjab produces 77% of Pakistan’s wheat, its policy largely shapes the country’s supply chain. Over the last three crops, it adopted three different policies: stopping procurement in 2024, introducing an Electronic Warehouse Receipt system in 2025, and shifting to a private sector-led model in 2026. None of these delivered the desired results.
Meanwhile, despite claiming market deregulation, the Punjab government increasingly relied on administrative interventions such as district-specific prices, artificial price caps, raids on stocks held by farmers and private stockists, and restrictions on wheat movement during 2025 and 2026. These measures aimed to keep wheat flour affordable for urban consumers but may have distorted market incentives at the expense of farmers.
The core issue is that while complying with international financial institutions’ conditions, Pakistan’s federal and provincial governments pursued a policy that failed to balance the interests of farmers and consumers. The abandonment of the decades-old public procurement system without establishing a credible market-based alternative has left farmers vulnerable.
The question now is: why has this supply-demand mismatch emerged barely three months after harvest? Lower yields and changing farmer behavior, including reduced use of costly phosphate fertilisers due to recurring financial losses, as well as heat waves and crop lodging at the maturity stage, have all contributed to a decline in estimated yields by an estimated three to five percent.
These developments raise serious questions about the credibility of official wheat production estimates, adequacy of strategic reserves, and overall management of Pakistan’s wheat supply chain.
