Pakistan witnessed a historic surge in imports of pulses during FY23, clocking in at an astounding 1.344 million tons worth $946 million. This figure exceeded the previous all-time high of 1.266 million tons, valued at $709 million in FY21.
Back when the State Bank had limited imports of several commodities, the situation reached a boiling point in January 2023. The importers took to the streets, staging a protest outside the State Bank of Pakistan’s head office against the non-clearance of over 6,000 imported containers of pulses. These containers had languished for two months at the Karachi port due to a dearth of US dollars and banks’ reluctance to approve crucial import documents.
The crisis began to see some resolution as the availability of dollars improved, and the government prioritized preventing potential food shortages. Importers swiftly moved to ramp up their imports, fearing possible future hurdles. Furthermore, the sluggish local production further fueled the impetus for increased imports.
Despite the massive influx of pulses, consumers experienced a mixed trend in prices for various varieties. Notably, the national average price of masoor ranged between Rs. 250 to Rs. 320 per kilogram, compared to Rs. 260 to Rs. 350 per kg in the first week of July 2022. Meanwhile, moong, mash, and gram prices surged to Rs. 215 to Rs. 320, Rs. 300 to Rs. 540, and Rs. 200 to Rs. 300 per kg, respectively, up from Rs. 155 to Rs. 240, Rs. 220 to Rs. 370, and Rs. 190 to Rs. 260 per kg.
The Economic Survey FY23 paints a concerning picture of Pakistan’s pulses production, with gram taking a significant hit. During FY23, gram production plummeted by 24.7 percent, amounting to a mere 238,000 tons, compared to the previous fiscal year’s 316,000 tons. This sharp decline can be attributed to a decrease in the cultivation area for the crop.
The decline in production was not confined to gram alone, as masoor, moong, and mash also experienced dips. Masoor production fell by 2.6 percent to 3,800 tons in FY23 from 3,900 tons in FY22. Similarly, moong and mash saw substantial drops, registering declines of 49 percent and 31 percent, resulting in production figures of 135,000 tons and 4,200 tons, respectively. This contrasts significantly with FY22’s production levels of 264,000 tons for moong and 6,100 tons for mash.
Despite the considerable imports of pulses, the local market has witnessed high prices. Shedding light on this puzzling phenomenon, Faisal Anis Majeed, a seasoned importer/exporter of commodities, pointed out that world pulses prices remained relatively stable without any significant increase.
Instead, Majeed attributed the soaring rates in the domestic market to multiple factors. Notably, the rupee’s devaluation against the dollar, coupled with high demurrage and detention charges at the port due to delayed container clearance in January, has compounded the challenges. Additionally, rising transportation costs, driven by surging diesel prices, have further impacted the landed cost of imported pulses, resulting in the prevailing high prices.
The average per tonne price of pulses in FY23 stood at $703, showing a moderate increase compared to $674 in FY22.
The drop in local production has created a considerable consumption-demand gap. Pakistan’s annual demand for gram currently stands at 700,000 tons, followed by 150,000 tons each for masoor and moong, and 90,000 tons for mash. To fulfill this demand, Pakistan primarily relies on imports from countries such as Australia, Canada, the USA, the African region, and Myanmar.
