Archive for July, 2011

Engro increases urea prices by Rs145 per bag

Post Source: DailyTimes




KARACHI: Engro Fertilizer has increased the price of urea by Rs 145/bag to Rs 1,360/bag at dealer’s level from Rs 1,215/bag earlier.

The international urea prices against the locally produced one fell from almost 90% earlier to 70% now. This increase is believed to have been for 20 days (15-day gas shortages plus 5-day that the plant takes for start-up). Engro’s management hinted at a price increase in first week of Jul-11. However, immediately after that, the whole episode regarding the gas charges increase for fertilizer sector unfolded itself.

This is the 4th time in the last 7 months that the price of urea has been increased. It was done on three occasions to curtail production losses while one was to incorporate increased taxation impact. Better farmers’ economics had enabled Engro to increase their prices in the past due to bumper Rabi crop during 2010 and exceptional prices in the international markets. However, with cotton prices falling from above the level of Rs 12,000/mound (down 45% since peak), and taking a breather at Rs 6,700/mound, as it could be seen the farmer economics taking a hit. staff report


Outlook for Sindh

Post Source: Dawn Economic and Business Review

By Mohammad Hussain Khan

THE cotton crop in Sindh offers a healthy outlook this season. With last year’s impressive returns — Rs4,000 to Rs5,000 per 40 kg — the farmers have been motivated to grow more cotton this season. The area under this crop has increased. The Sindh Agriculture Department has retained last year’s sowing target of 650,000 hectares for this season. Reports from various areas indicate that cotton sowing is still under way in some areas whereas growers — who opted for early sowing of the crop — have already done the first picking of cotton in places like Tando Mohammad Khan and Badin. Agriculture officials state that acreage has increased to 654,000 hectares this year. “We believe the acreage will increase further,” says an agriculture official after paying a field visit. The Sindh Agriculture Department is eying a production target of 4.5 million bales this year but growers and some officials hope the output to touch a five million bales mark as water has been fairly available, by and large. Last year’s output was, however, 4.2 million bales. The estimates differ because officials are not taking recent reports of pest attacks on cotton lightly, saying if growers do not control it now, it could lead to substantial crop losses. Attacks of thrips, jasid, white fly and mealy bug are being reported from various areas by growers. These attacks are not unusual but still they have to be controlled using proper pesticides and spray in fields. Dr Atta Soomro, who is holding additional charge of DG Agriculture Research Institute, Tandojam, noted jasid pest attack during his field visit. Thrips and root rotwere also there. “These are not unusual but they can’t be taken lightly. These pests also attack BT cotton which is only resistant to American bollworm,” he says. Jasid likes BT cotton’s leaf structure. After BT cotton, the severity of jasid has increased. The growers are advised to use proper spray to control jasid attack. The growers often don’t apply proper protocol of pesticides, and consequently end up as sufferers. The left bank cotton growers of Thatta district also appeared a little disturbed over the pest attack, and as a seasoned cotton producer, Haji Nadeem Shah of Thatta put it “the attack is not being controlled despite use of pesticide”. He feels that cotton crop is quite healthy but the fast blowing winds and humidity has left an adverse impact on it. There is shedding of flower and proper fruit setting has been hit. “I have noted pink bollworm in Mirpurbathoro. Growers are maintaining last year’s cotton plant allowing bollworm to complete its life cycle,” remarks Shah. He says BT cotton doesn’t offer resistance to sucking pests and that’s why they are being found in different cotton growing areas. A Mirpurkhas grower Mir Zafarullah Talpur confirms mealy bug attack on cotton but not on a big scale. He says pesticides are not helpful in curbing the disease. Secretary Agriculture Agha Jan Akhtar considers pest attack as insignificant and says Sindh is bound to have a bumper cotton crop this year. “BT cotton is the most popular of all varieties that is grown by abadgars and it resists pest attacks,” he says. But the grower bodies’ representatives recommend that these attacks should not be ignored and handled carefully to avoid crop losses. The Sindh Abadgar Board (SAB) General Secretary Mehmood Nawaz Shah notes that “everything should not be taken for granted because if pest attack is not controlled at this stage the losses to crop can be as high as 20 to 25 per cent”. He says mealy bug attacks four to five plants initially but if it remains unchecked, it increases its severity, harming the entire cotton farmland. The growers sow BT cotton for its better per acre yield potential. Some companies claim the yield as high as 100 maunds per acre. But, on an average, it gives 50 to 60 maunds per acre which leads to major gains for the growers in case of high prices. Meanwhile, irrigation department’s rotation programme continues, leading to protests by cotton growers of tail-end areas of different canal systems. Some growers have already suffered losses in early sowing in Mirpurkhas, Jhuddo, Shahdadpur and Badin areas. Water shortage renders cotton plant weak and vulnerable to different diseases. However, secretary irrigation Khalid Hyder Memon says that growers are usually interested in having 100 per cent cultivation of their lands which is not legally justified. They have to go for 27 per cent cultivation. “If the crop is drying up due to 100 per cent cultivation then complaints are not justified.” he says, admitting that water shortage complaints are also due to mismanagement of irrigation department.

Promising cotton crop in Punjab

Post Source: dawn Economic and Business Review


By Ahmad Fraz Khan



SOME good news is expected from the cotton front this season, at least from Punjab. The current crop condition is so healthy that provincial planners are dreaming about 10 million bales.

They are convinced that even if they miss this magic figure, they would certainly be crossing nine million bales with a big margin provided nothing goes wrong during July — a crucial month for the crop.

Their current optimism is based on the favourable weather conditions, which has brought blessings – controlling cotton leave curl virus (CLCV) and improving water supplies, keeping the crop out of stress. For the last many years, both these critical factors, on an average, had resulted in the loss of almost two million bales.

According to provincial figures, only two per cent crop is under the CLCV attack against 27 per cent during the first week of July last year. It makes the crop virtually virus free at the moment. With another spell of rain that hit the country, the chances of CLCV would be further reduced.

But, if the rains are as excessive as they were last year, another set of problems may occur. The crop might come under renewed stresses: excessive vegetative growth in some pockets while stunted growth in others, early boll formation in some areas while decaying in others. To make the situation even worse, pests may return — bringing the crop cycle back to square one.

The farmers hopefully would be better prepared and committed to save the crop because of more profits it brought last year. They did it last year, and there is no reason why they should not repeat the feat this year. The only thing they now need is to irrigate the crop according to the meteorological advisory. If it is already raining, they should not irrigate the crop. Instead, they should improve the drainage so that water does not remain in the field.

Last year, excessive rain had led to fungus formation around ripe bolls and hit the yield at the last moments. The cotton crop in Punjab had never seen fungus attack, and it had left everyone at loss.

The government officials may think the phenomenon was specific to last year due to extra-ordinary weather, but there is no certainty that it will not recur this year. The farmers should keep a watch.

The second reason for official optimism is the weather behaviour during May and June. There were no rains that normally lead to crust formation on the soil and forced farmers to re-sow the crop. The April sowing is thus now 70 to 80 days old, and on an identical stage of growth that makes it easier for the government officials to issue advisory. The department this year is issuing advisory every week, instead of fortnightly.

Though there was no rain during these two months, there was, however, an ample supply of water that kept the crop out of water stress. Normally once crop comes under water stress, pest attack starts. This year, healthy water supply, by and large, kept the pests away.

Third source of hope for better crop comes from the urea crisis. Urea price made it almost impossible for farmers to apply fertiliser to the crop. The prices have almost doubled in the market in the last one year.

The May off-take of urea dropped by almost 20 per cent, and farmers feared that prices would go further up, making it out of their financial reach.

The officials, however, are also reading other side of the urea prices and its off-take. If the crop can reach present healthy condition despite substantial drop in urea application, proper management can successfully take care of the crop from here onwards. This is exactly the line of thinking in official circles, and certainly not without a measure of justification.

In order to safely take the crop to final stage, the agriculture department has riveted its entire attention on its crop monitors. In order to make things easier for them, the Punjab government recently released Rs65 million for auxiliary expenses needed to save the crop.

For the first time, the officials of the agriculture department are doing something seriously for agriculture. The development can only be welcomed.

Finally, the provincial cotton planners are also hoping improvement in quality of cotton as well because of `clean crop` that the province is going to harvest.

The better management practices (BMP) carry a premier world over and provide a model that farmers and industries can replicate. It is time for the textile industry to come forward and train farmers into picking, packing, storing and transporting quality cotton so that this opportunity is not lost to mismanagement in the last moments.

The industry has taken many such initiatives in the past, but most of them lost momentum at some stage of implementation.

This year it must be taken as a God-send opportunity for the stakeholders to join hands and create an efficient integrated farmers` training programme that starts with soil preparation to transporting their produce to the market.—Ahmad Fraz Khan

Impact of pesticides on crops

Post Source: Dawn Economic and Business Review


By Tahir Ali Khan




NEARLY 50 per cent of the pesticides used in the country are highly hazardous. Their residue causes skin and nervous system`s toxicity.

Waters containing pesticides, when used for drinking purposes, can be harmful, ranging from mild headache and skin allergy to cancer of internal organs.

Its adverse effects on health depend upon the degree of toxicity, amount of water intake each day and the individual`s health. Adverse effects on human health can also be caused by impurities in pesticides.

The threat of pesticide resistance to agricultural productivity is accelerating as commercial development of new pesticides has slowed down. It is estimated that for developing a pesticide, over 15,000 chemicals are screened over a period of about 8-10 years. At present, the major strategy in controlling pest is the use of chemicals, some of which belong to WHO category A and B, extremely hazardous.

Since 1980, there has almost been a linear increase in the use of pesticides. At present nearly, 86 pesticide companies are registered with the federal agriculture ministry. During 1994, pesticides consumption was 23,212 metric tons. Widespread use of pesticides has resulted in their presence and persistence in various crops and their occurrence in food and products. About 30 per cent of potential crop production in the world is lost every year due to bad weather, pests and diseases. The losses may increase further if the use of pesticides is abandoned.

A variety of pesticide chemicals are available in the market for the control of insect pests, attacking vegetable and other crops. Each crop is susceptible to attack by more than one pests. It is usually treated with several pesticides before harvest. It is estimated that 80 per cent of the total pesticides consumed in the country are used for the protection of cotton crop, from July to October.

The historical analysis of pest occurrence indicates that the current system of pest management, which relies mainly on the use of pesticides (over six spray/season), is responsible for the change in cotton pest complex and is a never ending practice.

Conclusion: The pests, diseases and weeds cause heavy losses to both major and minor crops in the country. Some experts estimate such losses to be as high as 20 per cent and even more.

The indiscriminate use of pesticides has to be discouraged and sale of adulterated ones be strictly banned. Quality control of chemicals, being used against pests and diseases, needs to be strictly enforced so that their effectiveness is not impaired.

Furthermore, instead of importing chemicals, indigenous products (such as use of neem leaves etc) be encouraged by providing needed facility, so that they are easily available to farmers at low prices.

It is also the duty of concerned agency of pesticides to ensure distribution and sale of its products to the farmers without compromising ethical standards.

Empowering female farmers

Post Source: Dawn Economic & Business Review


By Tahir Ali Khan



WOMEN are deeply involved in agriculture and livestock sectors in Khyber Pakhtunkhwa. They, however, remain deprived of access to extension services, financial empowerment and capacity-building while no facility is offered to them for training, input/services and livestock progeny.

The provincial agriculture policy 2005 and horticulture policy 2009 acknowledge that the absence of gender mainstreaming and participation, hinder the growth and development of the sector, making it less profitable for farmers, especially the poor/small growers.

While the provincial government has now acknowledged the need for empowering of women, its efforts in this direction are too feeble to make any significant impact.

In this year’s budget, a project for livelihood improvement through strengthening of gender-based livestock interventions with an outlay of Rs300 million has been launched in the province. Through this project, female livestock farmers would be provided training for rearing animal offspring and hens to help improve their skills and decision-making capacity. But only Rs15 million has been earmarked this year for disbursement for the project.

Another project worth Rs46 million is to be launched in Mardan which aims at alleviation of poverty among rural women by providing them with high calibre hens for rearing in their houses. This project will promote model poultry farms and would improve supply of poultry and its byproducts to the market.

Apart from carrying out household jobs, women also work in field preparation, cultivation, fodder cutting, weeding, drying/storing of cereals, fodder and harvesting crops and vegetables.

According to a survey carried out in five districts of KP, 82 per cent of the rural women took part in agriculture activities, spent 45 per cent of their time in fields which accounted for 25 per cent of production of major crops and 30 per cent of total food.

Around 35 per cent of rural women rear livestock and are responsible for 60 to 80 per cent of feeding and milking of cattle. Over 90 per cent of rural women keep poultry birds at home. However, they mostly apply traditional methods of rearing, breeding and management of livestock.

New concepts such as tunnel farming, modern household farming, tissue culture technology and modern animal husbandry techniques need to be used to increase production and encourage efficiency.

With expert guidance and technical, financial and marketing support provided to female farmers, agriculture would develop by leaps and bounds.

Rural women in the province have no separate agricultural extension services. Living in a backward region, female farmers would willingly attend trainings if these are arranged through female extension workers. Female veterinary graduates could be appointed for curing livestock owned by female farmers in rural areas.

They can also be provided support for opening biogas plants to cater to their domestic fuel needs that consume plenty of their incomes though other altrenatives.

The government and NGOs could empower women farmers and involve them in agriculture development by setting up a provincial body of women farmers.

The membership of female farmers in model farm services centres needs to be increased. Female farmers were part of only one MFSC in Haripur which had only 70 female farmers in the total strength of 1,600 farmers in 2009.

But with the present meagre funding, any significant progress for agriculture in the province remains a remote possibility. The share of agriculture as percentage of the provincial annual development plan has come down to 1.59 this fiscal year from 1.70 per cent in the last fiscal.

In a situation where only six per cent of the farmers in the province receive agriculture credit, the share of female farmers would be even more pathetic. The government needs to support agriculture financing by public and private sector banks to offer easy farm and non-farm loans to female farmers.

AGRICULTURE AND TECHNOLOGY: Trial shipment of mango to Europe

Post Source: Dawn Economic and Business Review

By Mohammad Hussain Khan





THE first-ever trial shipment of mango for high-end super markets of Europe dispatched directly from two orchards in Sindh is indeed a pioneering effort. Eight such shipments are taking place from all over the country.

Pack houses have been set up at the two farms where mango fruits go through hot water treatment amidst modern farming practices, a pre-requisite for sale in European and other developed countries’ super markets. Two more pack houses are being set up in the province.

The growers who have exported mangoes directly from their farms are Global GAP (good agriculture practices) certified farmers. They have been improving their farming practices over the years.

As part of the USAID project, the farmers were provided with equipment for hot water treatment, grading, packing, blast chilling and cold storage besides picking of fruits as per required methodology. After applying modern farming techniques, the fruit—Sindhri– was directly exported in refer containers from farm to seaport to foreign markets which is inexpensive as compared to by air freight.

Normally growers lease out their farms to contractors who market the crop the way they prefer. Orchard owners borrow money from the contracts which is adjusted against the sales.

However, for the global GAP certified farmers, pack houses are an innovation and a new experience. They invest their labour, fruit and built infrastructure for the pack house. These farmers look forward for government’s research and development
department’s assistance.

Besides, trial shipment, some commercial shipments were also made by farmers through private exporters in Karachi. The exporters got the fruit processed at their pack houses and offered them reasonable price like Rs35 per kg for sending it to different markets. The exporters, generally, have been sending mango to markets in the Middle East and not to the high-value super markets of Europe due to the absence of facilities that now have been made available.

The trial shipment has been made to the port of Netherlands (Holland) in Rotterdam which is due to reach there on July 6.

Two USAID officials working with the project would be in Holland reporting the arrival of the consignment and observing
markets where the fruit is displayed. They would send reports about the response of the market with reference to any shortcomings that were not taken care of.

Under modern techniques, mango picking is done carefully to avoid damage to the fruit followed by hot water treatment.

Mangoes are placed on a sorting panel to move at snail’s pace, allowing farm workers to sort out defective ones. Then they are washed before being dipped in hot water for three to five minutes at 52 degree Centigrade. Grading facility is there too and the fruit is, then, packed in cartons.

“Hot water treatment kills anthracnose disease if any on the fruit,” says Zain Shah, one of the two growers who sent their trial shipment to Netherlands. The sea route is inexpensive for export to Europe and the government should assist mango farmers in this respect. “We have invested Rs500,000 in terms of fruit’s cost, processing, electricity and labour charges besides raising civil infrastructure on our land,” says Zain Shah and expects the government to come forward and share the growers’ burden.

According to Junaid Shah, who sent eight tons of mango in trial shipment, construction of pack house cost him Rs10 million besides other expenses of processing and farm labour. He adds that he also handled some commercial shipments to Dubai, Jeddah and Iran. “Capacity of hot water treatment plant is just one ton per hour and it needs to be enhanced,” he says.

He had been exporting mango through private exporters but often the fruits over ripened causing him losses. “If the fruit reaches the markets in better shape only then we get the required payment and a refer container sells more expensively than a normal open container,” he says.

The blast chillers and cold storage maintain cold chain right from farm to market to avoid over ripening of the fruit and
preserve it for another 30 days. According to a researcher Abdul Qadeer Durrani, shelf-life of Pakistani mango is 35 days after hot water treatment. He has been dealing with mango for 27 years and says that hot water treatment kills bacteria from the surface of the mango.

As far as markets of US and Japan are concerned they link import of fruit to irradiation and vapour hot treatment (VHT) plants respectively. Trade Development Authority of Pakistan is sending trial shipment to Japan in July where Pakistani mango has been given access following a visit by President Asif Ali Zardari. TDAP has floated EoI [expression of interests] for VHT plants whereas a huge cost is involved for the irradiation plant.

Another GAP certified grower Imdad Nizamani — who had sent mango after processing it through same technology in Karachi privately – says that similar shipment was sent to Europe but it was not that successful at that time.

The fruit was given the same modern hot water treatment by the exporter in Karachi. “But pack houses are set up at farms for the first time in Sindh. It will certainly make a difference. Let us wait for shipment results, he remarks.

Growers who export their fruit to markets of Iran and Dubai don’t get better margins in absence of modern agriculture practices where there is a very wide room for improvement. Their profit margin through export could be as high as Rs150,000-Rs200,000 per acre if they adopt modern farm management conditions instead of giving them to contractors — who give them Rs35,000 to Rs50,000 per acre.

AGRICULTURE AND TECHNOLOGY: Credit-starved farm and agro industries

Post Source: Dawn Economic and Business Review

By Muhammad Bashir Chaudhry



THE government should focus on development of agro industries in the rural areas for boosting export of processed food products, says the president of the Islamabad Chamber of Commerce and Industry.

It should help farmers to modernise farming, improve per acre yield and cultivate new varieties of fruits and vegetables.

Foreign buyers can be particularly attracted if more attention is paid to organic farm products. The country can become self-sufficient in food grains and create exportable surplus.

But the basic question is whether the existing institutional framework of farm credit and rural development is sound enough to deliver.

A review of the SBP and other publications gives the impression that the sector needs much more attention than what the lending institutions provide. Banks are meeting only around 45-50 per cent of the farm credit requirements and the number of borrowers is around two million out of 6.6 million of the country’s farmers.

The credit is highly concentrated in crop sector or production loans with around 75 per cent of the total disbursement on this count, and there is an uneven geographical distribution with more than 80 per cent of the credit going to Punjab.

Agriculture credit is only six per cent of the loan portfolio of banks. There is lack of commitment among the banks’ management and non-availability of innovative lending products.

Banks do not see farm financing as a viable business due to agriculture-specific risks. The ratio of nonperforming farm loans is high due to the culture of write-offs/waivers.

The mark-up rate of farm credit is generally higher than the commercial and industrial credit. Banks’ markup rates are not fixed sector-wise but are based on their cost structure and risk profile of the borrowers and the sector. Banks are required by the SBP to use Kibor as a benchmark for pricing of their loans.

Informal credit market is characterised by low transaction costs, very high interest rates and rapid disbursement of credit.

The close familiarity of borrowers with informal lenders, coercive loan recovery methods and the inability of formal institutions to reach the poor, have brought about heavy dependence of the rural population on informal credit markets.

Agriculture is also susceptible to risks on account of natural hazards, unreliable infrastructure, poor pricing policies, insufficient and improper marketing mechanism, poor quality seed, low per acre yield and lack of coordination among the government service delivery agencies.

Fears are that many farmers are crossing poverty line because of decrease in land holding to below subsistence level due to
Islamic inheritance laws.

Farm workers are being displaced due to mechanisation of large land-holdings. These unemployed or under-employed poor people move to cities and create social problems.

Enough steps are not being taken to hold them in rural areas by providing them jobs with productive and income-generating activities. The farmers and rural workers are thus left at the mercy of informal lenders and middlemen to exploit.

There is an urgent need for specialised banks/DFIs for facilitating credit flow to small farmers-cum-handicraftsmen for development of agriculture as well as cottage and village industries, handicrafts and other rural crafts.

Rural development can be promoted by financing of agro-based micro-industries, small industries and agro-infrastructure.

Loans by the commercial or microfinance banks are at high commercial rates and unsuitable for small farmers and unemployed rural workers.

The agro-finance banks should offer soft small loans that are affordable to people in the rural areas. These banks may be provided suitable credit lines to be used as soft loans to farmers cum-handicraft men and women. The whole structure of the agro-financing and rural development should be revamped.

Growing of food grains or cash crops and working of rural cottage industries or handicrafts is closely interlinked. A typical farmer with small land holding may be concurrently involved in all these activities for survival and welfare of his family. All members of the family contribute in this endeavour.

However, their efforts are often frustrated when they are unable to get fair price for their produce, owing to machination of shrewd middlemen.

The lending and loan recovery practices of the financiers in rural areas should be fair, equitable and non-exploitative. This is essential for economic revival, public welfare and self-sufficiency in food.