This thread is a case study of how to cause a wheat crisis two years in a row.

Title: "Anatomy of wheat crisis : Part Deux"
Sub title: "Slow motion train wreck : the sequel"

Based on the following three news items. A newspaper reporter or journalists may be able to do a much better job than me chronicling this. The story may evolve and this may turn much ado about nothing.
Caveat: Aap k bhai ko wheat and agriculture policy ka kaddu bhi nahin pata.

Business Recorder [TCP’s ‘lacklustre’ approach to looming crisis flagged ]( https://www.brecorder.com/news/40024527 ) Oct 8
Express Tribune [ECC allows wheat import from Russia]( https://tribune.com.pk/story/2267402/ecc-allows-wheat-import-from-russia-1) Oct 8
Dawn [Wheat — a saga of mismanagement]( https://www.dawn.com/news/1584610 ) Oct 13

Wheat watchers (i think an unintended pun in the Dawn report) knew in April 2020 that loss in yield is evident. The government, however, refused to acknowlege it hoping the wheat machine is broken (my bad pun). Followed the strategy of "head in the sand" for two months.

Finally in June, govt estimated importing 1MMT be sufficient to meet the shortfall allowing pvt sector to import 1.5MMT of wheat duty free. It took 1 month to issue the SRO ie on July 21. Shortfall estimate was revised to 1.5 MMT by this time. By Sep, shortfall was close to 3MMT.

As Pakistan went to world market, the price increased from $230/ton to $280/ton translating into a price of Rs.2,100 per maund against official release price of Rs.1,475 per maund (almost a 50% increase). Releasing at official price will require a subsidy of Rs.725 per maund.

Chairman TCP said that ECC should not issue press releases about releasing tenders of procurements of large quantity of wheat as it leads to increase in international prices of wheat.

Due to difference between import and official price, private sector slowed down and asked the govt to increase the release price. The proposal went 3 times in last 4 weeks to Punjab cabinet but was defeated everytime fearing social unrest. Pvt sector stopped its import at 0.5MMT

Govt reluctantly was forced to induct TCP and asked it to import another 1.5MMT. TCP asked Rs.75 billion for purchase. Fed gov negotiated with provinces to underwrite the funds and after weeks of negotiations, Punjab agreed to finance 0.7MMT, KP 0.3MMT, and PASSCO 0.5MMT.

Someone during the cabinet meeting enquired if PPRA rules will be applicable as no DIRECT payment is being made in this case by the government. Commerce Ministry says NO. Minister of Law and Justice says YES. Inhon nay kar li import.

Govt has approved 5 pre-shipment inspection agencies (PSIAs) for inspection wheat. Only 2 PSIAs have agreed to sign agreement with TCP. The article does not elaborate on why the remaining 3 refused to sign agreement with TCP. Did no one wonder about this in the federal cabinet?

TCP says that 2 PSIAs are not sufficient for the contracts TCP intends to sign. TCP suggested four more names of PSIAs to be approved. Commerce Ministry asked the federal cabinet for one time approval to add these names for the current procurement cycle. No more fear of NAB?

A day before the ECC meeting, Oct 6, PM had also chaired a meeting to review the wheat situation and directed that 1.5MT of wheat should be imported at all costs. Truly a "kun fayakun" style of government.

TCP Chairman added that ports are congested and he is having trouble securing berths for vessels carrying imported wheat. Ali Zaidi (maritime minister) ko online portal for shipping or Bundal island mein Dubai bananay say fursat ho to real issues par focus karay

TCP approved only one tender out of the 4 tenders it floated.
1. 0.33MMT at $233.8 per ton - approved
2. 0.17MMT at $ 274 on Sep 9 - cancelled
3. 0.3MMT at $ 280.9 on Sep 23 - cancelled
4. 0.3MMT at 278.5 on Oct 5. 8 parties participated. No details if approved or canceled

Advisor to Finance & Revenue revealed that in a meeting with relevant minister, TCP was given a go-ahead to purchase the lowest quoted price. But to his utter surprise, TCP board canceled the tender.

Chairman TCP says that fear of NAB is hindering procurement of wheat. (Digression: Meanwhile NAB gets to publish a glossy 8 page eulogy in favor of Javed Iqbal and fake degree holder post fact certified degree holder Shahzad Saleem in Daily Times.) https://twitter.com/hyzaidi/status/1315217261200896001?s=20

Cabinet directed adviser to PM on Finance and Revenue Dr. Hafeez Shaikh to oversee and ensure timely import of wheat. Hafeez Shaikh kia kia karay.

A week earlier on Oct 2, ECC formally approved import of 0.18MMT from Russia on government to government basis at $279 per ton. As per Oct 8 reports, "The deal is in final stages".

Apparently the Russian govt agency Prodintorg offered only 24 hours to respond and we responded in affirmative.

Ye konsi govt to govt deal chal rahi hain.

A week later i.e. now, the g-to-g deal with Russia for the 0.18MMT of wheat is in doldrums as government realized it set the wrong benchmark for subsequent imports and is therefore renegotiating.

A week later i.e. now, the g-to-g deal with Russia for the 0.18MMT of wheat is in doldrums as government realized it set the wrong benchmark for subsequent imports and is therefore renegotiating.

TCP is in the tendering process even after 60 days of approvals and it may take another few weeks before its purchases start having impact in the market.

This has resulted domestic wheat prices at 2400 per maund and first time in the history of this country, atta being sold at three different rates.
Officially ground atta: Rs. 45 per kilo
privately ground atta: Rs. 75 per kilo
Chakki atta: Rs. 85 per kilo

Shocking that seeds of this crisis sprouted in April 2020, three months after the last year's crisis came to a head in Jan 2020. Shameless replug of the "Original Slow Motion Train Wreck" thread of 2019 wheat crisis. https://twitter.com/2paisay/status/1218741932723142656

More color from June https://www.brecorder.com/news/amp/40000922

https://twitter.com/ahmedikram_/status/1284883478358773761?s=20

Hopefully with last year's crisis still fresh, the game of headless chickens being played in ECC and TCP will soon be brought to an end and prices be brought under control.

The proceedings of the cabinet are entertaining if you aren't the one standing in line to get atta.