Thursday, August 4, 2022

Pakistan's Biggest Food Import: Edible Oil Worth $4.5 Billion Worsens Trade Deficit

Rising demand and soaring prices of cooking oil raised Pakistan's edible oil import bill to $4.5 billion in fiscal year 2021-22, according to government sources. Pakistan is the world's third largest importer of palm oil after India and China. Total cooking oil imports add up to 3.7 million tons while the total annual edible oil consumption is about 5 million tons. Pakistan's palm oil imports are the second biggest commodity import after more than $20 billion in energy imports, accounting for a significant chunk of Pakistan's growing trade and current account deficits.  

Sources of Palm Oil Imports in Pakistan. Source: Dawn

Pakistan Palm Oil Consumption Growth. Source: NationMaster

Pakistan's edible oil consumption has been rising over the years. It is now about 24 Kg per person which is among the highest in the world, according to analysts quoted by Dawn newspaper.  Combined with rising prices, the total imports of palm oil could exceed $6 billion next year. It could further worsen the country's balance of payments problems. Is Pakistan doing anything to try to grow oil palms in the country? Researchers at the Institute of Business Administration (IBA) in Karachi have studied it and reported the following: 

"Based on our research, visits and interviews it was determined that in Pakistan there are ample opportunities and favorable conditions for growing oil-palm trees. Report findings suggest that the coastal belt of Sindh has proven capability of growing oil-palm trees with a per acre yield comparable to that in major oil palm growing countries due to plenty of fertile land, irrigation water courses, supply of fertilizers, and skilled farmers available in this part of land".  

Pakistan Food Imports. Source: TDAP

Sindh Coastal Development Authority (CDA) has recently announced plans to plant 60,000 oil palm trees on an area of 1,000 acres in the current fiscal year.  An earlier project in 2020 showed that the oil content of palm fruit from Sindh's plantation in Thatta is 2% higher than the world average. 

Per Capita Wheat Consumption in Pakistan vs World. Source: Abdul Mottaleb et al

Per Capita Edible Oil Consumption in Pakistan. Source: Pakistan Growth Story

Southern Indian state of Telangana has launched a much more ambitious project to plant palm oil trees on 2 million acres of land in the next four years.  To achieve this goal, the state has plans to build large dams and irrigation canals and import millions of germinated sprouts.

Related Links:


Indos said...

Olive oil is the solution for Pakistan. Olive oil as far as I know is match with Pakistan climate which is quite dry with less rain, something similar with Palestinian land where olive oil farming is quite large.

Riaz Haq said...

Indos: "Olive oil is the solution for Pakistan"

Pakistan has a variety of climate zones ranging from cold and dry to hot and humid.

Pak produces apples, peaches, oranges, mangoes and bananas.

It can grow both olives and oil palms.

Moh said...

An interesting thing to note is that Pakistan's per capita edible oil consumption is 24.8 kg, India's is 19.8 kg, and china's is 9.8 kg.

Seeme said...

That is what I thought. No Pakistani food can be cooked without some oil, butter, ghee. All of them are so expensive. How can people cook these days?
Olive Oil is doing well. Pakistani's should learn to use it.

Riaz Haq said...

With Pakistan's 24 Kg per capita consumption of cooking oil, I am reminded of a
"Panchon unglian ghee (cooking oil) mein", a South Asian phrase describing the image of plenty.

It also brings up another South Asian phrase "Aap ke munh mein ghee shakar (sugar)"

Per caput sugar consumption in Pakistan, at about 22 kilograms a year, is slightly above the world average and compares to India's per caput use of 15 kilograms. If the consumption of non-centrifugal sugars were added, apparent consumption would be much higher.


Sugar consumption per capita reached 21.1 kg in 2019 in Pakistan, according to Faostat. This is 2.41% less than in the previous year.

Historically, sugar consumption per capita in Pakistan reached an all time high of 25.8 kg in 2008 and an all time low of 1.80 kg in 1961.


Generally, centrifugal, and non-centrifugal brown cane sugar show a superior nutritional value and bioactive molecule content compared to refined white cane sugardue to the molasses content and the process requiring less refining on different products.

Riaz Haq said...

Pakistan’s total oilseed use to hold steady in 2022-23 | World Grain

Imports of soybean, canola and palm oil are expected to hold steady at 3.4 million tonnes. No growth is expected in edible oil imports for 2022-23 and are forecast at 3.7 million tonnes(accounting for 70% of total cooking oil consumption in Pakistan). Soybean and rapeseed imports for 2022-23 are forecast to remain on par with the previous year at 2.6 million and 0.8 million tonnes, respectively. While facing significant price pressure and potential for disruption in supplies from key exporters, palm oil is forecast to remain the major imported oil, with imports forecast at 3.6 million tonnes.

Riaz Haq said...

The government has planned to increase the annual edible oil production up to 4.79 million tons over the next 10 years in an effort to take the country towards self-sufficiency in food commodities, especially in edible oil.

Minister for Planning and Development Ahsan Iqbal presided over a meeting on Friday to review the measures being undertaken to achieve self-sufficiency in edible oil.

It was informed that Pakistan imported 4.5 million tons of edible oil annually to meet its demand. At present, the country produces just 0.745 million tons of edible oil annually, which is only 8% of the total demand of over 5 million tons.

The move would help minimise the huge import bill of the food group that was recorded at $7.57 billion in the first 11 months (Jul-May) of fiscal year 2021-22.

The import of palm oil was recorded at $3.06 billion while that of soybean oil stood at $217.7 million during the period under review.

The meeting reviewed the measures being taken for palm oil sufficiency and planned that the production would be gradually increased from the current 0.745 million tons to 1.192 million tons in five years and to 4.793 million tons in the next 10 years.

Ahsan Iqbal directed that the plan to take the country towards self-reliance in edible oil should be discussed with all provincial stakeholders and a feasible roadmap should be finalised within a week after taking all of them onboard.

The minister said investors in the edible oil sector should be given special incentives to boost local production.

He said making the country self-sufficient in edible oil was the top priority of the government’s development agenda and directed to engage the private sector to expedite the process.

samir sardana said...

Pakistan cannot import the Palm Kernel and refine it in Pakistan - nor can Palm grow in Pakistan,and the CPO rates are on the BMD - so what can Pakistan do ?

There are only 2 options

1 is Pakistan has to induce farmers to farm oil seeds - mustard etc.,so that there is an offset hedge - which is that the CPO imports can be offset with sunflower/safflower/mustard exports.When ever OIL zooms - edible oils also move up (and not only due to biofuels). Pakistani people have to be made to shift to other edible oils - farmed in Pakistan.

Second is that Pakistan has to have a retail inflation target for 6-12 months - and depending on the prices of the components of retail component - like food etc. - WITH THE AIM OF CAPPING THE FUTURE RETAIL INFLATION - GOP HAS TO BUY BMD FUTURES TO LOCK IN RATES OF CPO - AT LEAST TO THE EXTENT OF A 3RD OF ITS IMPORTS



Riaz Haq said...

Inflation measured by the Sensitive Price Index (SPI) increased by 0.82 per cent from the previous week, mainly due to a slight increase in perishable food products, according to the Pakistan Bureau of Statistics (PBS) data released on Friday.

Last week, a 3.68pc increase was noted in the SPI, which was the highest since the change of the base year for measuring the SPI. On June 17, the second highest increase in weekly inflation was recorded at 3.38pc.

The year-on-year increase in the SPI was 38.63pc, the highest ever recorded. This is the highest increase recorded on a year-on-year (YoY) basis. Last week, the government increased the price of diesel while slightly lowering the price of petrol. The impact of diesel on prices will be visible in prices next week.

The PBS data shows that the prices of 33 essential food items increased during the week under review compared to the previous week.

Anonymous said...

groundnuts are grown in upper/northern Punjab and KPK. Sindh does grow some but its a negligible amount, i belong to a long line farmers and as far as punjab and mustard oil goes, Punjab alone can feed the entire Pakistan's needs, but the bonus is Sindh can easily grow it too! Punjabis have recently started eating mustard oil, know a few people who shifted from palm to mustard oil , still a small amount of people but its a work in progress!

Jamal said...

We also grow corn. To be honest there are endless oils that can be used. In Britain, corn oil and vegetable oil are common.

Riaz Haq said...

From Wheat Exporter to Wheat Importer
Dr. Muhammad Shahbaz
July 17, 2022
The writer is research fellow at University of Cambrdige, UK and Professor at Biejing Institue of Technlogy China.

The agricultural sector is one of the largest contributors to the economy. While declining as a proportion of GDP, agriculture still contributes one-fifth of Pakistan’s wealth and almost half the population depends directly or indirectly on agriculture for their livelihoods. With 79.6 million acres of arable land, there is a great potential for improving efficiencies and productivity of the agriculture sector. The crop sector is an important sector of the economy which provides food to rapidly growing population of the country. The major crops consist of six main crops: wheat, rice, sugarcane, maize, chickpea and cotton. Wheat is Pakistan’s largest crop, in terms of area sown and is grown under different agro-ecological zones. Wheat flour currently contributes 72% of Pakistan’s daily caloric intake with per capita wheat consumption of around 124 kilograms (kg) per year, one of the highest in the world. In irrigated areas, wheat is planted after cotton, rice, and sugarcane, while in rain fed areas wheat is grown at the same time as maize and millet. The sowing of wheat takes place from October to December and harvests from March to May. Approximately 80% of farmers grow it on an area of around 9 million hectares (close to 40% of the country’s total cultivated land) during the winter.

Wheat is the most widely grown crop in the world. Wheat (Triticum aestivum) is one of the first domesticated food crops and has been the basic staple food of the major civilizations of Europe, West Asia and North Africa for last 8000 years. Approximately one sixth of the total arable land in the world is under wheat. It is most demanded food grain and its production leads all crops, including rice, maize and potatoes. In Pakistan, wheat being the main staple food cultivated on the largest acreages. Pakistan falls in ten major wheat-producing countries of the world in terms of area under wheat cultivation, total production and yield per hectare. Wheat is the essential diet of population as it constitutes 60% of the daily diet of common man in Pakistan and average per capita consumption is about 125 kg and occupies a central position in agricultural policies of the government. Based on cropping pattern, disease prevalence and climate, Pakistan has been divided into a ten production zones. However, production zones need to be revisited. In Pakistan, wheat is grown in different cropping systems, such as; cotton wheat, rice wheat, sugarcane wheat, maize wheat, fallow wheat. Of these, Cotton-Wheat and Rice-Wheat systems together account about 60% of the total wheat area whereas rain-fed wheat covers more than 1.50 m ha area. Rotations with Maize-Sugarcane, Pulses and fallow are also important.

Riaz Haq said...

From Wheat Exporter to Wheat Importer
Dr. Muhammad Shahbaz

Pakistan’s growing population is seeing an increased demand for wheat. However, the production of the commodity is not rising at a proportional rate. Pakistan’s 2020-21 marketing year wheat production is expected to decrease to 25.2 million tons due to the impact of untimely rain at harvesting. Despite having fertile lands and bumper wheat crops, Pakistan had to import four million tons of wheat last year. South Asian country has undergone a historic shift from being an exporter of wheat to a major importer of wheat. Agricultural experts of Pakistan have called upon the government to impose a ban on wheat exports of local grains amid serious repercussion of the Russia-Ukraine war, which will disrupt the supply of wheat in the international market. A farmer’s lobby group, has suggested the government to maintain wheat stocks through procurement during the on-going harvest and put a stop to wheat exports. It should be noted that Ukraine is the third largest exporter of wheat, holding at least 12% share in the global export market for the staple grain. The war in Ukraine will push the prices higher and opportunists might sell off the food security to fill their coffers. The escalating tensions between Russia and Ukraine will have a serious economic fallout, effects of which have already started to show in Pakistan. Local prices of gasoline, food, commodities, and steel and semiconductor chips are witnessing a major increase. Pakistan is the seventh-largest market in the Middle East, African, and South Asian regions, as measured in Purchasing Power Parity (PPP). It has the second-largest economy in South Asia, after India. The economy has been growing slowly over the past two decades. However, the containment measures adopted in response to the COVID-19 pandemic led to a severe contraction in economic activity.

Pakistan has bought wheat regularly in the global market in recent months to boost domestic supply and cool prices. Pakistan’s MY 2020/21 wheat imports are estimated at 3.4 MMT.

Riaz Haq said...

Wheat Consumption Determinants and Food Security Challenges:
Evidence from Pakistan

Since 1975, 27% increase in
total area and 52% increase in yield per hectare for
wheat are reported. While, 33% increase in wheat
availability per capita was deemed insufficient. In
this situation, imports of wheat were the most
apparent result due to higher growth of population.
To fulfill the dream of food self-sufficiency,
government facilitated farmers by providing high
yielding varieties, fertilizers at a subsidized rate,
irrigation water at a lower rate than tube well water
etc. Though, these facilities have not been able to
reach the desire level of output mainly due to (i)
poor economic conditions of the farmers, lack of
knowledge on the latest useful techniques and
advancement. (ii) low price of production at
harvesting time made the farmers insecure about
investments they have done for inputs. (iii)
inappropriate land levelling along with late sowing
resulted in lower production. (iv) Insufficiency,
inequity, and unreliability in water distribution are
mutually affect the farmers irrigation calendars for
the wheat crop. Water stress to wheat at sensitive
stages, hinders the entire effort of production [20].

Riaz Haq said...

India’s poorest scald as cooking oil prices soar

India’s #poor scald as #cooking #oil prices soar. #India’s poorest are paying the highest cost for a #food #crisis long in the making and now turbocharged by events ranging from the war in #Ukraine to policy changes in global #trade. #inflation #Modi #BJP

India consumes 16.5 kg of cooking oil per capita, significantly higher than 9.5 kg in China, and nearly double 8.4 kg in the United States.
The numbers, skewed by heavier use in urban areas, mean that the world’s second most populous nation is particularly hit by the record highs. (Pakistanis consume 24 Kg per capita, the highest in the world)


On a muggy April afternoon, Kumud Sahu wipes his face with an oily turmeric-stained handkerchief. He gulps water from a dimpled plastic bottle as he haunches on a wooden bench. It’s the only place to sit at his roadside eatery in the bustling working-class neighborhood of Jawaharlal Nehru Road in the eastern Indian city of Kolkata.

“Life has always been tough,” says Sahu, scanning the swarming crowds oblivious to the slow unraveling of the stalls that serve their affordable lunches. “But I haven’t seen tougher days than these. Business has been extremely bad and I am not sure how I can continue to feed my family.”

As the world’s largest importer of cooking oil reels from a steep ascent in its price, India’s poorest are paying the highest cost for a crisis long in the making and now turbocharged by events ranging from the war in Ukraine to policy changes in global trade.

India is reliant not only on cooking oil but on imported cooking oil. The South Asian nation consumes nearly 25 million tonnes of cooking oil a year, but produces only about 11 million tonnes. The gap is met through imports.

That creates a big and growing problem for a country whose population is expected to surpass China's and hit 1.7 billion people in the next three decades.

And experts say India will be unable to wean itself off this dependence for at least another two decades, as demand in a country that uses oil for much of its cuisine continues to far outpace production.

It is among the most disturbing examples of how a worldwide spiral in food prices has spooked billions of people and their governments. A deadly storm of pressures including war, pandemic and global heating has dramatically increased the cost of household food baskets in countries rich and poor. It has raised fears of mass impoverishment and social unrest, like that seen in neighboring Sri Lanka.

Sahu looks enervated. It has been 12 hours since he began his day in a room no bigger than 11 sq. meters, where he lives with his wife and three children. They share a bathroom with three other families in a longstanding tenement. Just before sunrise, he sets out for his eatery, cycling about 10 km. There he sells cheap, tasty lunches, oily curries with enough calories to keep his customers full until the next meal.

“Prices have increased so much that we can't imagine what will happen to the business if this trend continues,” he says, squinting in the harsh Kolkata sunlight. “I am putting in money from my savings to keep the business afloat.”

Sahu has shied from passing on the costs to his price-sensitive clientele, many of whom are shopkeepers and small business owners themselves.

With snowballing costs and a determination to keep his children in a school that is inexpensive but not free, Sahu was forced to sell a piece of rural land that he had hoped to keep as an asset for the years to come. “It bought me some time,” he said.

Pulling in around 60% of its cooking grease from overseas, India was hurting even before the Ukraine war as shipping costs, energy inflation and labor shortages, along with extreme weather, kept thrusting food and oil prices higher.

Riaz Haq said...

Pakistan’s Rising Palm & Soybean Imports: Understanding Key Drivers and Challenges
By Sohaib Jamali Senior Economist at the State Bank of Pakistan (SBP).

Pakistan’s imports of palm and soybean products have risen 55 percent in 1HFY22, following a 47 percent increase in FY21. While this recent growth stems from soaring international commodity prices, the overall trend is not a new phenomenon. Combined imports of palm and soybean have more than doubled over the last twenty years, rising to 7.1 percent of total imports in FY21, amid waning reliance on domestic sources (sunflower, canola, & cottonseed) for edible oil and meals for animal feed.

Palm and soybean are the world’s most used crops for edible oil and oilseed meals because of their high resource-use-efficiency, measured in terms of oil yield per hectare for oil, and protein yield in the case of meals. The former is important to meet the requirements of a growing human population and rising per capita consumption. The latter is important to feed ruminants, poultry, and aquatic foods, since protein-based meals enable faster and healthy growth of these animals.

In Pakistan’s case, the demand for edible oil is being driven both by growing population and rising per capita consumption. Contributing to the latter is a dietary preference for higher oil use, as suggested by cross country comparison of per capita edible oil consumption. And because palm oil is generally cheaper than other types of edible oils, Pakistan imports palm oil the most compared to other oils.

Similar demand drivers are at play in the case of oilseed meals. Growing population and rising per capita income are stoking the demand for poultry, livestock and farmed aquatic foods, which in turn creates a demand for oilseed meals as key components of animal feed. And following the fast paced modernisation of the domestic poultry industry, the demand for soybean meals has increased manifold. The growing modernisation of the dairy and meat industry, as evidenced by an increasing number of corporate meat and dairy brands, is also creating a demand for soybean-based meals.

Riaz Haq said...

Pakistan's oilseed industry to bloom under China-Pakistan agriculture cooperation

To help Pakistan meet its edible oil demand and support its foreign exchange reserves, Chinese company Wuhan Qingfa Hesheng and Pakistani company Evyol group jointly provide high-quality hybrid canola seeds to Pakistani farmers.

GUJRANWALA, Pakistan, Feb. 27 (Xinhua) -- On a sunny February morning, the air in a small village in Pakistan's east Gujranwala district carried the sweet scent of canola flowers, which were dancing gently in the breeze.

Bees whirling on the profuse yellow blossom beaming with lush green pods were not only a view to behold, but also heralded the beginning of a new chapter in the lives of local businesspeople and farmers, who are shifting to a Chinese hybrid variety of canola seeds to reap higher yields and produce cooking oil at home.

"We sowed the new variety on 100 acres of land because of their potential to produce higher yields and more oil as compared to other oilseeds including mustard and rapeseed, which we previously used to cultivate," Intisar Ahmad Chattha, the farm's manager told Xinhua while carefully watching the pods.

Pakistan's annual consumption of cooking oil is around 5 million tons, but due to the low economic potential of oilseeds in the local market, they are not preferred by the farmers. The country has to import about 89 percent of oil to meet the demand, spending 3.6 billion U.S. dollars annually.

Ghazanfar Ali, head of marketing in Evyol group told Xinhua it took them 10 years to produce a variety that is compatible with the local climate, produces a good yield and is good for human health.

The crop provides an increased profit for the farmers as its standard 2 kg pack is enough to cultivate 2 acres of land, and the farmer can get 1.5 tons of yield out of it, which is over 10 percent more than the yield from other varieties currently available in Pakistan, he said, when talking about the potential of the crop.

Zhou Xusheng, director of the international business department of Wuhan Qingfa Hesheng Seed company, told Xinhua that his company is working on transferring technology to Pakistan to make it efficient in smart agriculture.

"Through this project, we want to transfer the harvesting technology through which the farmers can use some attachments on the harvesters they already have and reduce the wastage," he said.

His company also wants to introduce processing units across the country, through which even in villages people can install them and produce processed oil for themselves and sell it to others, Zhou added.

He said that the seed is suitable for the environment across Pakistan, and this year they sold 11 tons of seeds across the country, which will be cultivated on 20,000 acres, and their target for next year is 100 tons, which will bring a great change to Pakistan by helping the country become self-sufficient in edible oil production.

The Chinese company will also buy back the canola harvest from some of the farmers and send it to the edible oil factories so that both farmer and the factory owners can realize the potential and health benefits of the oil, Zhou added.

"When Pakistan imports oil, it spends a lot of money and receives only the finished product. But when oil is produced locally, it will generate job opportunities, build an industrial chain and utilize the cakes after oil extraction as power-packed canola meal for cattle," he added.

Talking about the demand for canola meal in Pakistan, Chattha said that they have over 800 cows in the dairy farms in the area and to provide them with good quality food they have to import canola meals, which is a big financial burden due to the devaluation of the local currency.

Riaz Haq said...

Edible oil’s rocky year - Profit by Pakistan Today

The year 2022 was not a walk in the park for both the producers and the consumers of palm oil. The year saw historic highs and record lows in the palm oil market causing volatility and at times losses as well.

According to the State Bank of Pakistan, Pakistan imported Palm and Soybean oil in excess of $3.3 billion this year. This is a 33% increase as opposed to the FY21. Despite import restrictions in place. Pakistan has already imported a considerably larger amount of palm and soybean oil between Jul-Nov in FY23, than it did in FY22.

Being such a major import, the prices of palm oil are almost as important as any other global commodity. Let us have a look at how the prices of Palm oil were affected throughout the last year, and how that can act as a lesson for the years to come.

Riaz Haq said...

Tea plantation to help Pakistan reduce import bill

ISLAMABAD-Pakistan can reduce its import bill by exploiting its great potential for growing tea on a large scale, WealthPK reported.

Tea is one of the most important high-value cash crops. Despite its low cost, tea is the most popular beverage in Pakistan. The country has great potential for tea plantation on a large scale.

Abdul Waheed, Director of National Tea and High-Value Crops Research Institute Shinkiari, told WealthPK that the current rate of population growth showed that demand for tea would continue to increase over time, putting a strain on limited foreign exchange resources. He said that Pakistan’s total import bill for tea in the fiscal year 2022 was more than $590 million.

According to a recently-conducted survey, there is a huge potential for tea cultivation in Pakistan. It says that 158,000 acres of land in Khyber Pakhtunkwa and 4,000 acres in Azad Jammu and Kashmir are suitable for tea plantation, which can not only meet the local demand but can be also exported to other countries. Abdul Waheed said that more than 15 tonnes of locally produced and processed green tea was exported to Japan during the last three to four years.

Fakhar powers Pakistan to thrashing win over New Zealand in 2nd ODI
“Tea plants can be raised both from seed and cuttings. In Tea World, tea has initially been raised through seeds because of the economic ease with which its plantation is expanded,” said the director of the research centre. Many countries like China, India, and Sri Lanka, the world-known tea producers for centuries, still raise more than 75% of tea through seeds. Due to high population pressure coupled with the low economic condition, Pakistan presently needs to grow tea. The country also needs to increase the yield of all agricultural commodities.

“Historically speaking, nations of the world have always gained self-sufficiency in quantities first before becoming quality conscious. Thus, tea quantity in the shortest possible time can be economically obtained from tea seeds and not from cuttings,” Abdul Waheed told WealthPK. According to the Food and Agriculture Organisation of the United Nations, tea is one of the most important cash crops and plays a significant role in rural development, poverty reduction and food security in exporting and developing countries. It is a principal source of livelihood for millions of people.

Riaz Haq said...

As of March 2023, Pakistani authorities still ban genetically engineered (GE) oilseed imports. While they have made some progress in developing a system to allow for GE oilseed imports, uncertainty regarding when that system will be operative clouds the outlook for oilseed imports. Similar uncertainty surrounds domestic meal and oil production forecasts. With expectations for better cottonseed production, total oilseed production in 2023/24 is projected to increase to 2.95 million tons, a 24 percent above than 2022/23. In line with population growth, edible oil demand is forecast to grow about 5 percent, and palm oil imports are forecast to grow accordingly, reaching 3.6 million tons (15 Kg per person) in 2023/24.


India’s oilseeds production in marketing year (MY) 2023/2024 (October-September) is forecast to remain flat at 41.5 million metric tons (MMT), mostly unchanged from MY 2022/2023. Unseasonably heavy spring precipitation and a predicted El NiƱo weather pattern in the wake of severe April-June heatwaves will expose summer oilseed crops to greater incidences of plant stresses and thus impact yields. Oil meal production will remain steady at 20 MMT while exports will fall to 1.9 MMT, following an exceptional increase in exports in the current MY as southeast Asian demand has favored competitively priced Indian oil meals against other origins. India will remain among the largest consumers of edible oils and is forecast to import 14.5 MMT (10 Kg per person) of various oil commodities in the outyear. Global decline in oilseed prices and relatively low import duties have stabilized domestic edible oil prices, leading to record ending stocks in the current year.

Riaz Haq said...

Feature: Chinese canola crops transform Pakistan's cooking oil industry, boosts local economy-Xinhua

Pakistan's annual consumption of cooking oil is around 5 million tons, but due to the low economic potential of oilseeds in the local market, they are not preferred by the farmers. The country has to import about 89 percent of its oil to meet the demand, spending 3.6 billion dollars annually.

Dealers associated with oilseed distribution have said that the newly introduced variety has a high-profit margin for the farmers and, as such, it has become famous among local farmers just two years after its introduction in Pakistan.

Muhammad Rizwan, a seed distributor in Gujranwala, told Xinhua that the Chinese canola seed is resistant to diseases and has a higher yield than other previously available oilseed varieties on the market.

"Other oil seeds were sold for about 5,000 to 6,000 rupees per 40 kg on the market this year, whereas the Chinese canola was sold for up to 9,500 rupees, it also had a 20 percent to 30 percent higher yield than the other varieties," Rizwan explained.

"The seed is now a hot cake in the eyes of farmers in the Gujranwala district so we have placed a higher order than last year to the seed company to meet the demand in the next cultivation season in November this year," he added.

Last year, 11 tons of seeds were cultivated on 20,000 acres of land across the country, while this year 100 tons are expected to be cultivated due to a higher demand for the seed.

Housewife Saima Rizwan told Xinhua that she came to know about this oil six months ago from social media and how the oil extracted from Chinese canola is beneficial for health besides being cost-effective.

"I asked my husband to buy the oil and its taste was so good that we have never bought imported oil since. We cook all local dishes in the oil, and sometimes when we invite guests, they can't tell the food is cooked in canola oil rather than the commonly used palm oil," the 32-year-old told Xinhua.

Muhammad Azim, team leader of Eyvol group in Gujranwala, said that it was a bumper yield of canola this year compared to other crops, due to which farmers were very happy.

"It is a new beginning because farmers are making a good profit as consumption of locally produced oil increases," said Azim.

"As a next step, we will focus on local production of the seeds in Pakistani nurseries with the help of our Chinese friends to make the seeds more affordable for the local farmers," he said.

Riaz Haq said...

Peanuts to solve high edible oil prices issue
Pakistan, China join hands to increase planting area, crop yield

Lately, Rainbow’s high-oleic-acid peanut cultivation base project was formally included in the China-Pakistan agricultural cooperation framework by the Ministry of Agriculture, China.

“As you can see, our seed registration with Pakistan Agricultural Research Council (PARC) has started. A total of five high-oleic peanut varieties for oil extraction of Runhua series have been trial-planted in Pakistan, which is expected to achieve fruitful results,” revealed Fan Changcheng, Deputy General Manager of Rainbow.

“Next, our aim is to increase the area gradually to 1,500 hectares in the coming years,” he said.

“My country has a long tradition of peanut planting. Peanuts like warm environment with sufficient sunlight, with loose and breathable sandy loam as the most suitable soil condition. The Potohar region of Punjab is the best area for peanut production,” Ijaz stated, adding that peanut seeds contain 40-50% oil and the high-oleic peanut oil is rich in unsaturated fatty acids.

“During our trial, we always focused on how the local environment can act on the quality of seeds on the whole. The varieties we selected have the highest oleic acid content, up to 75-80%, which means very high nutritional value.”

“Self-sufficient in peanut production means that we can reduce our import bill of edible oil,” said Muhammad Jahanzaib, Scientific Officer of the Oil Seed Research Programme in NARC Pakistan.

Statistics of the US Department of Agriculture showed that Pakistan’s peanut planting area in 2022-23 is about 150,000 hectares, with total output of 140,000 metric tons.


Riaz Haq said...

Pakistan: Oilseeds and Products Annual | USDA Foreign Agricultural Service

As of March 2023, Pakistani authorities still ban genetically engineered (GE) oilseed imports. While they have made some progress in developing a system to allow for GE oilseed imports, uncertainty regarding when that system will be operative clouds the outlook for oilseed imports. Similar uncertainty surrounds domestic meal and oil production forecasts. With expectations for better cottonseed production, total oilseed production in 2023/24 is projected to increase to 2.95 million tons, a 24 percent above than 2022/23. In line with population growth, edible oil demand is forecast to grow about 5 percent, and palm oil imports are forecast to grow accordingly, reaching 3.6 million tons in 2023/24.

Riaz Haq said...

The rise in global cotton production is led by the US, Pakistan, and India, with a drop in China's output due to cooler weather conditions.

Global cotton production in FY24 is forecast to reach a four-year high of 116.7 million bales, up slightly from the previous year, as per USDA.
The rise is led by the US, Pakistan, and India, with a drop in China's output due to cooler weather conditions.
Australia's FY24 cotton production is projected at 5.8 million bales, 300,000 bales above FY23.

World cotton production is projected to reach a four-year high of 116.7 million bales in 2023-24 (FY24), according to the US Department of Agriculture (USDA). The expected growth in production represents a slight increase of 400,000 bales from the previous year.
The increase is predominantly driven by the major cotton-producing countries, with the US and Pakistan leading the charge. Both countries are projected to see a significant rise in production, each adding 2 million bales to the global yield. India is also expected to contribute to the surge, albeit on a lesser scale, with an additional half a million bales.

However, these gains will be partially offset by a reduction in output from China, the world's leading cotton producer. The Chinese crop is anticipated to shrink by 3.7 million bales in the 2023-24 season due to cooler than normal temperatures early in the growing season in China's Xinjiang region, which could limit yield potential. This decrease means China's contribution to global cotton production is expected to shrink from 26 per cent in 2022-23 to 23 per cent in 2023-24, as per USDA’s Cotton and Wool Outlook: June 2023 report.

Meanwhile, India is set to buck this trend with a projected 2-per cent increase in cotton production from the 2022-23 crop. This rise comes despite an expected reduction in harvested area, with alternative crops predicted to reduce cotton acreage to 12.4 million hectares. A rebound in yield is set to offset this, with the national yield forecast at 448 kg per hectare, the highest in three years. India's share in global cotton production is set to remain steady at approximately 22 per cent.

Outside of the US, other countries including Brazil, Pakistan, and Australia are also projected to see an increase in cotton production. Brazil's output is expected to hit 13.25 million bales, slightly above the 2022-23 figure and second only to 2019-20's record of nearly 13.8 million bales.

Pakistan's cotton production is set to rebound from the nearly four-decade low of 3.9 million bales recorded in 2022-23 due to flood damage. The forecast production of 5.9 million bales for 2023-24 will account for 5 per cent of global production.

Lastly, Australia's 2023-24 cotton production is projected at 5.8 million bales, 300,000 bales above 2022-23 and close to 2021-22’s record of 5.85 million bales, supported by above-average reservoir levels.

Riaz Haq said...

Oilseeds in Pakistan

Oilseed Production:
Following last year’s flood-damaged cottonseed crop, total oilseed production in 2023/24 is projected to
increase 24 percent to 2.9 million tons, driven by a rebound in cottonseed production. While cottonseed
production is forecast to recover, little change is expected for rapeseed and sunflower production as
returns for other crops hinders oilseed area expansion.
Both rapeseed and sunflower production in 2022/23 are forecast to increase, but their share in total
oilseed supplies will remain at only about 20 percent. The government offered a 12,500 rupees ($50) per
hectare subsidy for oilseed growers in Punjab, which is one reason for the increase in canola output.
Nonetheless, the government generally also offers a generous guaranteed price for wheat, which
competes directly with rapeseed for area. Because of the more profitable guaranteed price offered for
wheat, growers will favor planting wheat over oilseeds. As a result, no expansion in rapeseed nor
sunflower seed production is expected for 2023/24. Domestic soybean production is insignificant.
Cottonseed production in 2023/24 is projected at 2.3 million tons, a 34 percent increase over the 2022/23
output. This increase reflects expectations for a recovery in yield following the flood-damaged 2022/23
output. Cottonseed is the principal oilseed crop grown, accounting for more than 70 percent of domestic
oilseed production. Cottonseed production is driven by demand for cotton lint from the local textile
sector, which is Pakistan’s number one export-oriented manufacturing industry. Despite the textile
sector’s requests and government efforts to increase cotton production, cottonseed output has been
declining for several years.
Due to better returns from crops (mainly wheat) that compete with rapeseed for area, no increase in
rapeseed production in 2023/24 is expected. Output in 2022/23 is forecast to increase as government
subsidies resulted in an increase in planted area.
Sunflower Seed:
Sunflower seed area and production are expected to decline in 2023/24 due to better returns from other
In 2023/24, total oilseed use, almost all of which is for crushing, is forecast at 3.6 million tons, 17
percent higher than the 2022/23 estimated use. Total installed crushing capacity is around 8 million tons
and no additional capacity going to be added in system. This higher consumption forecast assumes the
government removes the ban on GE soybean imports, which will then result in increased crushing for
poultry feed.
As a result of the import ban, oilseed use in 2022/23 is estimated to decline at least 21 percent. The
lower oilseed crushing has resulted in a commensurate decline in poultry feed consumption and poultry
meat production. Since the government abruptly halted soybean imports in November 2022, poultry
meat output is off about 31 percent and poultry prices have more than doubled.

Riaz Haq said...

Pakistan aims to boost oilseed cultivation

The Chinese Academy of Agricultural Sciences (CAAS) has been instrumental in developing new rapeseed varieties, which have been adopted in some northern regions of China. The success of these efforts has enabled China to rotate rapeseed(Canola) crops with staple crops like rice and wheat, maximising land utilisation.

Pakistan is now tapping into this experience by collaborating with Chinese company Wuhan Qingfa-Hesheng and Pakistani firm Evyol Group. Together, they are providing high-quality hybrid rapeseeds (Canola) to Pakistani farmers. Ghazanfar Ali, head of marketing at Evyol Group, emphasised the suitability of their variety for local climate conditions. “It took us 10 years to produce a variety that is compatible with the local climate, produces a good yield and is good for human health,” he said, noting that farmers can achieve 1.5 tonnes of yield from 2 acres of land, surpassing current varieties available in Pakistan by over 10%.

Zhou Xusheng, director of the international business department at Wuhan Qingfa-Hesheng Seed company, outlined their ambitions. “This year we sold 11 tonnes of seeds across Pakistan, which will be cultivated on 20,000 acres, and our target for next year is 100 tonnes.” He also highlighted their intention to purchase the canola harvest from certain farmers and supply it to edible oil factories, thereby promoting the benefits of locally-produced oil.

Riaz Haq said...

Pakistan’s annual consumption of edible oil is around 5 million tons, but due to the low economic potential of oilseeds in the local market, they are not preferred by the farmers. The country has to import about 89 percent of oil to meet the demand, spending US$3.6 billion annually.

Pakistan’s iron brother, China, also has great demand for edible oil. Last year, China’s cooking oil consumption is about 13.44 million tons. China also suffered a short domestic supply of edible oil until the mid-1950s, when China began to promote brassica napus, also known as victory rapeseed. Brassica napus plants are tall, disease resistant, and more importantly, the yield is very high. The improvement of rapeseed varieties laid the foundation for China to greatly increase rapeseed production.

In recent years, the Chinese Academy of Agricultural Sciences (CAAS) has made a great breakthrough in breeding new varieties of rapeseed, which have been extended to some parts of northern China. Rapeseed now realized seasonal rotation with rice, wheat and other staple crops, which maximizes the utilization of arable land. Such Chinese experience and technologies can be a good reference for Pakistan, according to CEN.

Chinese company Wuhan Qingfa-Hesheng and a Pakistani company Evyol Group jointly provide high-quality hybrid rapeseeds to Pakistani farmers. “It took us 10 years to produce a variety that is compatible with the local climate, produces a good yield and is good for human health,” said Ghazanfar Ali, head of marketing in the Evyol group. “The crop provides an increased profit for the farmers. They can get 1.5 tons of yield out of 2 acres of land, which is over 10 percent more than the yield from other varieties currently available in Pakistan.”

“This year we sold 11 tons of seeds across Pakistan, which will be cultivated on 20,000 acres, and our target for next year is 100 tons,” said Zhou Xusheng, director of the international business department of Wuhan Qingfa-Hesheng Seed company.

The Chinese company will also buy back the canola harvest from some of the farmers and send it to the edible oil factories so that both farmer and the factory owners can realize the potential and health benefits of the oil.